Lucas Energy, a wholly owned subsidiary of Lucas, was the preferred tenderer for a petroleum permit over part of the acreage released by the Government of Western Australia for petroleum exploration. In early 2008 Lucas Energy was offered a petroleum exploration permit 17/07-8EP covering 8,010 square kilometres of the Canning Basin. The Company considers the acreage prospective for shale gas, shale oil and tight gas. The grant of this permit is subject to the Native Title Act 1993. The Company is currently negotiating with the three groups whose native title claims overlap the permit area.
The Company is currently undertaking a review of seismic data of previously drilled wells to ascertain which parts of the permit area are likely to be the most prospective. Lucas’ negotiations to date have been directed towards the possibility of a site visit between the Company and the traditional landowners to determine whether there are any locations within the permit application area that are of cultural significance, and are therefore likely to be excluded from the permit area, or alternatively made the subject of a “no mining” condition.