Shares in Australia's Linc Energy rocketed 31 percent a day after it said two independent reports had confirmed it is sitting on potentially large resources of shale oil in South Australia.
Reports from two respected independent consultants estimated Linc's 100 percent owned Arckaringa Basin could hold between 103 billion and 233 billion barrels of oil equivalent in formations comparable to liquids-rich shale plays in the United States.
The estimates were what are called "unrisked prospective resources", which gives no indication on how easily the reservoirs can be tapped or whether oil and gas can be profitably produced.
"It's an extremely exciting, interesting target, but there's a lot of work to be done to demonstrate its potential," said Mike Harrowell, senior resources analyst at broker BBY.
Linc has appointed Barclays Capital to help it find a partner with experience in shale drilling.
Linc's shares soared to a high of A$2.83 on Thursday and last traded up 27 percent at A$2.74, valuing the company at A$1.4 billion.
Its market value has more than quadrupled over the past two months as Linc, mainly known for its efforts to develop underground coal gas-to-liquids projects, recently started producing oil in the United States, finally giving it cash flow to service its debt, Harrowell said.
Linc's biggest coup to date was the sale of its Galilee coal asset to India's Adani Enterprises for $2.7 billion in 2010. The promising project has yet to be developed.