LONDON (Alliance News) – Rose Petroleum PLC Friday said it has been granted a new hydrocarbon exploration concession in Bavaria, Germany.

The AIM-listed natural resources company said the new area covers 657,000 acres in the Weiden Basin and starts from February 1, lasting for an initial period of three years.

Rose said it is obligated to carry out a programme of works over the three years, including 2D seismic studies and geophysical measurements at an estimated cost of roughly EUR900,000.

The licence grant announced Friday represents the third in Germany for Rose, following the recent acquisition of the Konstanz and Beiberach concessions covering roughly 635,000 acres.

The company said the licence is both a conventional and unconventional oil play, meaning that hydraulic fracturing, or fracking may be used on the site, pending certain regulatory changes.

Shale gas fracking involves extracting gas trapped in shale by pumping in pressurised water and chemicals. In the US, fuel prices have falling sharply as fracking has become commonplace across such states as North Dakota and Mississippi.

However, so far in Europe fracking has had mixed results, sometimes meeting strong local opposition or proving unreliable. In the UK, there have been major protests against the method, which critics fear will pollute water tables in rural areas and may cause small earthquakes.

“The obligations of the Weiden licence work programme are not too extensive, and should the initial results be positive, we will be in a position to fast-track a more extensive exploration programme. We will be looking to update the market further at the appropriate time,” Chief Executive Officer Matthew Idiens said in a statement.

Rose Petroleum shares were up 2.3% to 0.563 pence, after jumping to 0.67p at the open.

By Tom McIvor; tommcivor@alliancenews.com; @TomMcIvor1

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