Tony Barlow Australia Limited’s executive chairman Jon Stewart said initial drilling results from the BG Webb-1 well were meeting pre-drill recoverable gas reserve estimates.

“With about 500 metres of prospective sands to drill through we have already between 75 to 100 billion cubic feet of deeper gas potential proved by this well,” Stewart said.

“We are hopeful that additional gas-bearing sands will be identified in the K sands yet to be drilled. The next 500 metres through the K sand target zone will be very interesting and could possibly prove more K sand gas reserves in the current well. Remapping also suggests there is a chance of a further potential 100 billion cubic feet of gas being present in the northern flank of the field.”

On 4 April, the failed menswear firm will ask its shareholders to approve its rebadging as Aurora Oil and Gas and reclassification as a resources stock.

The objectives of this first well were to significantly increase production and to enlarge the reserve position towards an estimated potential 300 billion cubic feet from multiple gas-bearing sands, Stewart said.

“The partners are well on track to meet these objectives and may even exceed them. This is a significant gas position in a market like the US where gas prices for producers are four times the price of gas in Australia, he said.

Stewart said the Flour Bluff gas development project had the potential to be a significant cash flow generator in the US and would represent an excellent first project for the company.

“It is pleasing to be able to report positive news to our shareholders so soon after committing their company to a future in the oil and gas industry,” he said.

Other partners in Flour Bluff include Australian oilies Victoria Petroleum and Sun Resources. The three Australian partners each have a 12.5% stake in the project.