Falcon Oil & Gas (LON:FOG, CVE:FO) said discussions are ‘well advanced’ with a number of companies that want to farm into its acreage in Australia’s highly prospective Beetaloo Basin.

The interest follows the exit of former partner Hess last year, which was followed by significant industry interest.

This is not surprising giving the prospectivity of the licences, which are estimated to host 162 trillion cubic feet of gas and 21bn barrels of oil.

Chief executive Philip O’Quigley, in comments made alongside the group’s annual results, said Falcon’s focus was on securing a farminee and completing the testing of Kutvolgy-1 well in Hungary.

“Progress to date on all of these fronts is in line with our expectations; we will make further announcements in due course," he added.

The statement itself charted a busy year for the group, which reduced the overriding royalty on the Beetaloo and acquired the minority interest outstanding in Falcon Australia.

The transactions mean Falcon shareholders will receive almost all the benefits accruing from any deal struck to explore and develop the Beetaloo.

The company, which also owns assets in Hungary, where it is partnered with a subsidiary of Gazprom, and South Africa, where it is expected to team up with US giant Chevron, revealed it is in rude financial health with US$8.4mln of cash as at the end of December.

As with any company at this formative stage of its development, Falcon was loss-making. However, the deficit narrowed to US$3.6mln for the last financial year from US$17.7mln previously.