Shale Permit Extended by Spain to 2016 for Heyco, Shesa

A venture including Texas shale explorer Heyco Energy Group won an extension of its permit to search for oil and gas in an area of northern Spain that the industry designated as one of the richest to be fracked.

The original 2006 permit ran out in August before the government ruled on whether drilling was compatible with environmental laws, according to a May 14 resolution that wasn’t published until today. The venture’s biggest partner is Shesa, an energy company of the Basque regional government.

Spain’s central government is trying to revive oil and gas drilling, and considering shale ventures that use hydraulic fracturing, or fracking, after a several-decade lull in exploration. It’s fighting in the Supreme Court to overturn bans on fracking imposed by several regional governments.

Officials at Heyco and Shesa weren’t immediately available for comment. The order, effective tomorrow, was signed by Jaime Suarez Perez-Lucas, general manager for energy policy at the Industry Ministry.

Extending the Angosto-1 permit allows the venture to drill exploration wells through June 2016, provided it wins environmental clearance.

The rural site is in a hilly area rich in rivers, stretching through the Basque, Cantabria and Castilla & Leon regions.

Spain currently has no exploration or production using fracking and horizontal drilling, techniques that have delivered an energy bonanza in the U.S.

Hydraulic fracturing involves blasting rock with water, sand and chemicals to open up fissures.

To contact the reporter on this story: Todd White in Madrid at twhite2@bloomberg.net

To contact the editors responsible for this story: Timothy Coulter at tcoulter@bloomberg.net Alex Devine, Ana Monteiro

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