FO.V

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About: http://www.falconoilandgas.com/


Falcon Oil & Gas Ltd. is a global energy company that is focused on acquiring, exploring and developing properties where we believe significant commercial reservoirs of oil and natural gas exist.

Our expertise includes some of the world's top oil and gas experts with several decades of highly successful unconventional and conventional natural gas drilling, development and production in North America. We are the first North American company to bring unconventional drilling and extraction technologies (developed in the tight gas sands of the U.S. Rocky Mountain region) to Europe.

Our global operations are focused in countries characterized by stable political leadership, a healthy, growing economy, a high regional demand for energy and an existing pipeline infrastructure that permits rapid delivery of oil and gas to market

Our offices are in Denver, Colorado, Vancouver, British Columbia, and Budapest, Hungary. Shares of our company trade on the Toronto TSX Venture Exchange under the trading symbol 'FO'.

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Today: support 3.34, resistance 3.86

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from: http://www.hemscott.com/news/latest-news/item.do?newsId=43853763638721

Falcon gets gas production license from Hungarian government UPDATE
(Updates with quotes)

BUDAPEST (Thomson Financial) - Canada's Falcon Oil & Gas Ltd says the Hungarian government has granted the company a long-term production license for its two concession areas in the country.

The approval was the last hurdle for Falcon's Hungarian operating subsidiary, TXM Oil and Gas LLC, before it starts drilling at its natural gas resource in southeast Hungary.

The production license is valid as long as Falcon continues operations in the areas, the company said.

'Falcon has acquired more than 1,100 square kilometres of 3D seismic, drilled five wells, commenced drilling of a sixth well, constructed a high capacity gathering pipeline and entered into a detailed testing and evaluating programme,' said Gyorgy Szabo, a member of Falcon's board of directors, in a statement.

'Now that Falcon has received the approval... the company will put the necessary systems and personnel in place to develop this extensive resource, consistent with the results of our ongoing testing programme,' he continued.


Today: support 3.44, resistance 4.14, Opinion BUY

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News

from: http://www.earthtimes.org/articles/show/news_press_release,110606.shtml

Falcon Oil & Gas Ltd. Announces Initial Test Results at Magyarcsanad-1 Well 
Posted : Wed, 23 May 2007 14:28:00 GMT

BUDAPEST, Hungary, May 23 /PRNewswire/ -- Falcon Oil & Gas Ltd. (TSXV: FO) ("Falcon" or the "Company") is pleased to announce that the Company has encountered a productive oil and gas interval in the Magyarcsanad-1 exploration well. The productive interval was encountered within the Endrod formation at a depth of 4,057 meters.

In an initial rate test in a seven meter gross interval, which the Company has not yet fracture stimulated, the Magyarcsanad-1 well flowed 377 barrels of oil per day of light crude oil (48 degree API gravity) and 745,000 cubic feet of gas per day. The total thickness of the Endrod formation behind casing is 362 meters.

The initial rate test had an estimated flowing bottom hole temperature of 182 degrees Celsius (360 degrees Fahrenheit) and a 3,843 pounds per square inch (psi) flowing tubing pressure. Down hole pressure measurements, surface fluid and gas samples were continuously monitored through the initial test period to aid the Company's plans for possible appraisal drilling. The liquid hydrocarbons from the well were sold to a third-party under an oil sales contract. Gas was flared. Falcon will move forward with the Magyarcsanad-1 well testing program, and will fracture stimulate the entire 362 meters of the Endrod formation that is behind casing.

Falcon CEO and President, Marc A. Bruner, said, "The naturally flowing Endrod oil zone encountered at the Magyarcsanad-1 adds a new dimension to our project, as the scope of our exploration program in Hungary expands to include oil."

The Magyarcsanad-1 well is located in the southern area of Falcon's Mako License and is approximately 16.5 kilometers south of Falcon's Mako-6 well and approximately nine kilometers east of the Mako-1, Mako-2 and Mako-3 wells, which were drilled several years prior to Falcon's acquisition of the Mako License. The Mako-1, Mako-2 and Mako-3 wells encountered gas and oil shows within the Endrod formation. The Magyarcsanad-1 well was drilled by Falcon as a southern delineation well to assist in defining the boundaries of a Basin Centered Gas Accumulation (BCGA) within the Mako Trough.

The recent and newly completed 3-D seismic acquisition program is being processed and integrated into the Company's previously acquired 3-D programs. This new seismic program covers the Magyarcsanad-1 discovery and will be important in defining possible offset appraisal wells.

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News: from http://sev.prnewswire.com/oil-energy/20070606/NYW11106062007-1.html

Falcon Oil & Gas Ltd. Provides Operational Update on Mako-6 and Magyarcsanad

BUDAPEST, Hungary, June 6 /PRNewswire/ -- Falcon Oil & Gas Ltd. (TSXV: FO) ("Falcon" or the "Company") has issued an operational update as part of its ongoing commitment to public disclosure announcing the following:

Falcon has resumed testing operations on the Mako-6 well in the lowermost part of the Basal Conglomerate, after fracture stimulating ("fracing") this interval in April 2007 with 79,000 pounds of proppant and 3,100 bbls of frac fluid. Prior to this current testing operation, the Company opened the well for flow, had gas flow to surface immediately and, due to the presence of manageable levels of H2S, the well was shut-in to wait for the correct equipment to flow the well safely. The well was then shut-in with frac fluid load still remaining for over a month.

The well is currently being tested through perforations from 5,326 to 5,328 meters in the Lower Basal Conglomerate. The fracced interval being tested is from 5,279 meters to 5,365 meters, a total of 86 meters; 69 meters Basal Conglomerate and 17 meters Synrift. The Basal Conglomerate is 273 meters thick from 5075 meters to 5348 meters. This remaining 204 meters of Basal Conglomerate will be tested following the completed analysis of results from current test. The Company is encouraged with the initial gas shows from this test and believes the gas shows will remain constant or will improve in the upper part of the Basal Conglomerate where rock quality increases and sand packages thicken. Falcon intends to announce details on the gas shows from this test after flow-back of frac fluid and bottom sediment has been completed.

On June 3, 2007, the test was resumed with an 8/64" choke. Within 8 hours of opening the well and recovering 208 bbls of frac fluid, gas surfaced in burnable quantities, which are too small to measure. After flow testing the well for 29 hours and recovering approximately 800 bbls of the frac fluid, it was noted that the flow-back was producing greater than expected quantities of bottom sediment. On June 4, the well was opened up to a 12/64" choke to assist in the clean-up. The well continued to produce gas in burnable quantities through the test separator throughout the day. On June 5, the well experienced a partial to complete tubing plug, which temporarily caused the well to cease flowing. After three hours of no frac fluid recovery, the well unloaded large quantities of bottom sediment, resulting in significant quantities of gas flow in and an 8-foot to 10-foot flare and increased flowing tubing pressures. Falcon will continue to flow test the well, recover as much of the frac load fluid as possible, ensure the tubing and perforations are free and clear of any obstructions, and, if required, assist the well bore unloading process via coil tubing-nitrogen. About two-thirds of the frac load water has been recovered.

Preparations to fracture stimulate the Magyarcsanad well are underway. Falcon is currently rigging up and will commence the well intervention and testing program in the coming weeks. Falcon is engineering a two stage frac that is designed to treat the effective Endrod interval through the existing perforation at 4,060 meters and introduce 4 sets of new perforations. The new perforations will straddle the existing perforations (2 sets above and below). The combined two stage frac will consist of approximately 350,000 pounds of proppant. The treatment is designed to stimulate the entire Endrod formation that is behind casing with a total effective frac height of nearly 300 meters. It is anticipated actual testing operation will commence the end of June.

Today: support 2.8033, resistance 3.2233 Opinion hold

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today opinon: Price  0.9200, Support 0.8467, Resistance 0.9667 BUY

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today opinon: Price  0.8300, Support 0.6633, Resistance 0.9633 BUY

from: http://sev.prnewswire.com/oil-energy/20070828/NYTU13128082007-1.html

Falcon Oil & Gas Ltd. Releases Review From the Scotia Group
BUDAPEST, Hungary, Aug. 28 /PRNewswire-FirstCall/ -- Falcon Oil & Gas Ltd. (TSXV: FO) ("Falcon" or the "Company"), today released a copy of a review completed by the Scotia Group, an independent, third party consultant to Falcon. The document provides a review of Falcon's operations and accomplishments, and provides recommendations for the Mako Trough.

The Scotia Group conducted its review in accordance with standards set out in the Canadian Oil and Gas Evaluation Handbook (the "COGE Handbook") prepared jointly by the Society of Petroleum Evaluation Engineers (Calgary Chapter) and the Canadian Institute of Mining, Metallurgy & Petroleum (Petroleum Society).

    Below please find the full content of the review.

    24 August 2007

    Mr. Marc A. Bruner
    President, Chairman & CEO
    Falcon Oil and Gas, Ltd.
    1601 Blake Street
    Suite 505
    Denver, Colorado 80202

    RE Mako Trough, Hungary Operations Review

    Dear Mr. Bruner:

    INTRODUCTION

Falcon Oil and Gas Ltd. (Falcon) and TXM Hungary, a division of Falcon, have requested The Scotia Group, Inc. (Scotia) to conduct a review of their operations in the Mako Trough of Hungary. The review is focused as follows:

    -- Processes utilized to date in the evaluation
       -- Operational and geologic
    -- Accomplishments to date
    -- Recommended alterations for improvement
    -- Recommendations as to the next steps

Scotia was contracted by Falcon in June 2006 to conduct a resource assessment of certain properties in the Mako Basin of Hungary. The study "Resource Estimate Mako Trough, Effective Date August 15, 2006" found there to be evidence of hydrocarbon resources within the Mako and Tisza exploration licenses controlled by Falcon.

The resources were found to lie in four prospective horizons: Szolnok, Lower Endrod, Basal Conglomerate, and Synrift Sequence.

The volumes were previously stated in our report entitled "Resource Estimate Mako Trough, Effective Date August 15, 2006."

Falcon's initial phase of exploration was to drill six wells and conduct a 3D survey of the exploration license in an effort to delineate the resource. In addition, Falcon was to conduct extensive testing and evaluation of the exploration wells to gain a better understanding of the rock properties and geologic environment. These objectives have been accomplished.

Scotia, as been Falcon's independent advisor since 2006, is of the opinion that Falcon has been diligent and prudent in its operations to date and, as advisor to Falcon, offers the following observations, comments and recommendations related to accomplishments, improvement considerations and recommendations of next steps and the way forward.

ACCOMPLISHMENTS

Following due diligence by Gustavson, Falcon conducted a 3D survey of the Foldeak region of the prospective area of interest. The survey was completed in late 2004. Following evaluation of the data, Falcon entered an agreement to participate in the Tisza and Mako exploration licenses.

In the later half of 2005, Falcon conducted two further 3D surveys, the Gater and Hod-Szikancs respectively.

Falcon also sought and was granted an extension to the exploration license in December of 2005.

Pusztaszer-1

In late 2005, Falcon began its initial exploration drilling program with the Pusztaszer-1. The well was designed as a delineation well to test the northeastern extent of the Mako Trough. The well was drilled to a total depth of 3,785 meters and encountered Gneiss Basement, the Endrod and Szolnok formations. The Pustaszer was then tested in the Szolnok formation following small fracture stimulation. The well tested approximately 200 Mcfd and 200 bwpd. Although the rate was small, the well established several key points:

    -- The well increased Falcons confidence in the recent seismic survey
    -- The well established the ability to frac the Szolnok at this depth.
    -- The well tested gas establishing the presence of mobile hydrocarbons in
       the Solzonk formation.

The results of the Pusztaszer are very encouraging, especially the fact that the well established the presence of mobile gas in the Szolnok formation.

Szekkutas 1

The next well to be drilled and tested in early 2006 was the Szekkutas 1. The well was designed to test the northwest extension of the Mako Trough and was drilled to a total depth of 3,585 meters. The well encountered the Triassic Basement, Endrod and the Szolnok formations. The well tested 130 Mcfd and 549 bwpd from the Triassic Basement. The Endrod tested gas at an unstabilized rate of 1,577 Mcfd at 50 to 100 ppm hydrogen sulfide and 150 Mcfd at similar H2S concentrations from the Szolnok. The presence of H2S in these concentrations required Falcon to abort the test due to safety considerations; however, the well provided much needed critical information.

    -- Hydrogen sulfide may be present in the objective formations. Reviews of
       the other area wells to date had not encountered H2S in any substantial
       concentration. The Falcon drilling program had not allowed for H2S in
       these concentrations and would have to be modified accordingly.

    -- The well established mobile gas in the northwestern portion of the
       basin in the objective horizons of the Endrod and Szolnok.

The results of the Szekkutas are very encouraging in the further evaluation.

Mako 6

The Mako 6 was the next well in the evaluation program to be drilled and tested. The Mako 6 was drilled to a total depth of 5,692 meters and was the first deep test in the basin. The well encountered the Synrift, Basal Conglomerate, Endrod and Szolnok formations. Petropysical analysis of the log and core data indicated the possible presence of hydrocarbons in all formations, establishing a possible hydrocarbon column of 2 kilometers. A test of the Synrift was attempted which proved tight. An interval at the base of the Basal Conglomerate was tested with initial rates of up to 700 Mcfd with associated H2S of 400 ppm, and improving. The test was aborted when a suspected down-hole failure occurred. The actual cause of the failure is speculative at present but appears to be the movement of a barite plug from below the test interval. The well provided the following information.

    -- Falcon established the ability to drill and complete at depths of 5,600
       meters.
    -- The well tested mobile gas from the Basal Conglomerate.
    -- Established a possible hydrocarbon column of 2 kilometers.
    -- Established the presence of hydrocarbon in the center basin.
    -- Confirmed the presence of H2S in the Basal Conglomerate.

Hod-North 3D Seismic

While conducting drilling operations on the Szekkutas 1 and the Mako 6, Falcon completed its fourth 3D survey in the area, the Hod-North.

Mako 7

The Mako 7 was the next evaluation well to be drilled and was designed to be a second deep basin test. The well was drilled to a total depth of 6,085 meters and encountered the Basal Conglomerate, Endrod and Szolnok formations. Petrophysical analysis indicates the possible presence of hydrocarbon in all formations encountered, but no testing has been accomplished to date. If the well tests hydrocarbons it may indicate the presence of a 2.5 kilometer hydrocarbon column.

Magyarcsanad 1

The next well in the evaluation program to be drilled was the Magyarcsanad 1. This well was designed to test the southern end of the Mako Trough. The well was drilled to a total depth of 4,272 meters and encountered the Endrod and Szolnok formations. The well tested oil from the Endrod formation at unstabilized rates of 360 bopd and 1,100 Mcfd, declining to 65 bopd and 137 Mcfd without stimulation.

This is very encouraging in that it establishes the presence of mobile high gravity oil in the Endrod formation. In addition, it indicates the Endrod in the area of the wellbore to be a naturally fractured reservoir capable of delivering hydrocarbon. If future analysis and testing establishes the Endrod to contain a pervasive natural fracture system, charged with hydrocarbon and capable of transmissibility of the hydrocarbon, this could significantly add to hydrocarbon resources of the basin.

The Endrod formation was recently frac'd to evaluate the effectiveness of fracture stimulation to this play.

Mako 4

The next evaluation well drilled was the Mako 4, designed to test the Szolnok formation in the southern portion of the basin. The well was drilled to a total depth of 4,011 meters. The well encountered the Szolnok formation and is suspended pending completion of the current Geologic and Operational review.

Szekkutas and Mako-Kelet 3D Seismic

The first half of 2007, Falcon completed its largest 3D survey acquisition of 870 square kilometers. This completes 1,149 square kilometers of seismic acquisition, covering almost all the BCGA in Falcon's License area. All the seismic surveys are being combined and reprocessed into a single data set for interpretation and analysis.

Licenses Conversion

In May 2007, Falcon achieved a significant milestone with the conversion of a major portion of the exploration licenses to a 245,775 acre production license.

SUMMARY OF ACCOMPLISHMENTS

The successful development of BCGAs in the United States is the result of the recognition of the nature of the unconventional resource and the development of advanced technology for gas recovery. Falcon assembled some of the most noted experts in the field of geology and operations to bring that technology to the Mako Basin. To that end, Falcon has be diligent in acquiring the appropriate knowledge and technology.

In summary Scotia is encouraged by the results to date achieved by Falcon. The company has accomplished the following:

    -- Established the presence of hydrocarbon in all intervals tested to
       date, no significant negative test have occurred in the prospective
       horizons.
    -- Proven the existence of a BCGA in the Mako Trough of Hungary.
    -- Produced evidence of a possible BCOA within the Mako Trough.
    -- Established the company's ability to effectively operate in a HP/HT
       (high pressure/high temperature) H2S environment in a prudent effective
       manner.
    -- Established the company's ability to manage and maintain relationships
       with the Mining Authority of Hungary.

RECOMMENDATIONS

Each new basin has its own characteristics. Falcon has recognized that in addition to tight reservoirs in a BCGA, there are likely other non- conventional reservoirs, including those involving adsorbed gas and natural fractures. Scotia has held extensive advisory discussions with Falcon regarding the recognition and characterization of a wide range of unconventional and conventional reservoir that may occur in the Mako Basin.

While encouraged by the results to date, Scotia recommends the following be undertaken as the company proceeds with the evaluation of the area of interest.

    -- Falcon should conduct a review both technical and operational of all
       activities to date. The objective of this review will be to produce
       improvement recommendations as to data quality, data preservation, data
       integration, operational improvements, HS&E standards and improvements,
       emergency response and preferred and required improvements in drilling
       design.
    -- Falcon should take the time to fully integrate the current geologic
       data set. This would include all 3D surveys, petrochemical,
       petrophysical and well test data. Scotia would further recommend that
       Falcon slow, if not suspend, current evaluation activities until this
       integration and interpretation is completed.
    -- All future well designs must consider H2S and CO2 in the selection of
       tubular, wellhead and down hole equipment.
    -- All well site activity and procedures must consider the presence of H2S
       and CO2.
    -- Falcon should develop, in conjunction with the proper Hungarian
       authority, an Emergency Response Plan.
    -- In the technical and operational review, particular attention needs to
       be paid to the mineralogy of the core samples and their compatibility
       to various completion and drilling fluids.
    -- The company should investigate the feasibility and value of utilizing
       massive hydraulic fracture stimulations in future wells.
    -- The company should investigate the value of utilizing horizontal and/or
       multi-lateral wells in conjunction with under-balanced drilling,
       especially in the Endrod.
    -- Target conventional reservoirs at the top of overpressure similar to
       those seen in the western basins of the United States.  These are
       likely to provide production while the deep basin is explored.
    -- Consider that there might be adsorbed gas similar to that associated
       with coal and shale gas and conduct on-site sample degassing
       experiments if such conditions are indicated.
    -- Carefully examine cores for natural fractures.
    -- Develop regional geological models for the origin of natural fracture
       systems, including jointing (expansion) and associated with faulting.
    -- Utilize seismic impedance data to identify contrasts in impedance that
       might be tied to natural fractures.
    -- Used 3-D visualization methods with stratigraphic datum impedance data
       to identify geobodies related to fracturing and overpressure.

In summary, Falcon has made significant progress in the evaluation of the prospective acreage in a relatively short period of time. The results to date are positive and very encouraging. All objective formations of the basin have tested hydrocarbons, thus proving the existence of mobile oil and gas within the objective horizons. Falcon's data collection and analysis efforts appear to be both comprehensive and advanced as is appropriate for the setting.

As is often the case, the analysis of collected data often does not keep pace with drilling. As of the summer of 2007, Falcon is at the peak of its efforts to complete the analysis of available seismic, petrophysical and well test data and integrate it to formulate reservoir models to aid in efforts to drill and test according to the geology. Plans for future operations will take full advantage of what has been learned to date.

Falcon must now position itself both technically and financially for the next phase of evaluation. The geologic model and interpretation must be advanced utilizing the data gained from Phase I of the exploration activity. The drilling, testing and completion programs need to be redesigned based upon the HP/HT and H2O and CO2 environment encountered.

QUALIFICATIONS AND LIMITATIONS

Independence and Conflict of Interest

This report has been prepared by The Scotia Group. Scotia is an independent oil and gas advisory firm headquartered in Dallas, Texas. All evaluations performed by Scotia are strictly fee-based and Scotia has not and will not receive any benefit which may be regarded as affecting its ability to render an unbiased opinion on the petroleum interests held by Falcon.

Use of This Report

This report was prepared exclusively for Falcon, and should not be duplicated or distributed to any third parties without the express written consent of Falcon and The Scotia Group, except as required by law. The Scotia Group authorizes Falcon to publicly disclose this Report and the information contained within in the Falcon conference of August 29, 2007.

Available Data

This study was based on data supplied by Falcon, on public domain information and on nonproprietary data from in-house files. The supplied data was reviewed for reasonableness from a technical perspective. As is common in oil field situations, basic physical measurements taken over time cannot be verified independently in retrospect. As such, beyond the application of normal professional judgment, such data must be accepted as representative. While we are not aware of any falsification of records or data pertinent to the results of this study, Scotia does not warrant the accuracy of the data and accepts no liability for any losses from actions based upon reliance on data which is subsequently shown to be falsified or erroneous.

We carried out our review in accordance with standards set out in the Canadian Oil and Gas Evaluation Handbook (the "COGE Handbook") prepared jointly by the Society of Petroleum Evaluation Engineers (Calgary Chapter) and the Canadian Institute of Mining, Metallurgy & Petroleum (Petroleum Society).

Professional Qualifications

Scotia personnel who prepared this report are degreed professionals with the appropriate qualifications and experience to complete the project brief. Scotia and its staff do not claim expertise in accounting, legal and environmental matters, and opinions on such matters do not form part of this report.

Scotia is pleased to aid Falcon in the evaluation of the Mako Trough. We hope you find our independent view of your operations and activities within the region constructive. We look forward to discussing these recommendations in detail at your convenience.

    Sincerely,

    THE SCOTIA GROUP, INC.
    Lonnie J. McDade, P.E.
    Vice President

    Contact:
    Weber Shandwick Worldwide
    Peter Duda /JJ Rissi
    +1 (212) 445-8213 / +1 (212) 445-8224

Falcon's discovered resources are not reserves. Only those quantities of oil and gas that are anticipated to be economically recoverable from discovered resources are classified as reserves. Until such time as Falcon's discovered resources are proven to be reserves, there is a risk that Falcon may not achieve ongoing operations from which it may generate significant revenue.

In the interests of providing Company shareholders and potential investors with information regarding the Company, including the Company's assessment of its and its subsidiaries' future plans and operations, certain statements included in this press release may constitute forward-looking information or forward-looking statements (collectively, "forward-looking statements"). All statements contained herein that are not clearly historical in nature are forward-looking, and the words "anticipate", "believe", "expect", "estimate" and similar expressions are generally intended to identify forward-looking statements. Similarly, forward-looking statements in this press release include, but are not limited to anticipated developments of the Company's drilling project in Hungary and the timing thereof, the Company's drilling project in Romania and the timing thereof, capital investment levels and the allocation thereof, pipeline capacity, government royalty rates, reserve and resources estimates, the level of expenditures for compliance with environmental regulations, site restoration costs including abandonment and reclamation costs, exploration plans, acquisition and disposition plans including farmout plans, net cash flows, geographic expansion and plans for seismic surveys. In addition, please note that statements relating to "reserves" or "resources" are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves and resources described can be profitably produced in the future. Such statements represent the Company's internal projections, estimates or beliefs concerning, among other things, an outlook on the estimated amounts and timing of capital expenditures, anticipated future debt levels and incentive fees or revenues or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. These statements are only predictions. Actual events or results may differ materially. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievement since such expectations are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause the Company's actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, the Company and the foregoing list of important factors is not exhaustive. These forward-looking statements are made as of the date hereof disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise. Company shareholders and potential investors should carefully consider the information contained in the Company's filings with Canadian securities administrators at www.sedar.com before making investment decisions with regard to the Company.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.