The company at the forefront of ‘fraccing’ the UK has finished what it says is the country’s first horizontal shale gas well.

Cuadrilla, which is 47.4 per cent owned by locally listed AJ Lucas Group (ASX:AJL), said it has completed the well at an exploration site at Preston New Road in Lancashire.

AJ Lucas also owns 48 per cent of Caudrilla’s Bowland licence.

While Cuadrilla says it’s the UK’s first well of this kind, it had already drilled another in an area called Balcombe in 2013.

“This first horizontal well, drilled through the Lower Bowland shale at a depth of approximately 2700 metres below ground, extends laterally for some 800 metres through the shale gas reservoir,” Cuadrilla said.

AJ Lucas shares have been improving over the last six months.

Horizontal drilling is a technique pioneered in the US to build an oil or gas well that doesn’t just go straight down, to increase access to the hydrocarbons underground.

It can be used with fraccing, or hydraulic fracturing, which is a method where water mixed with lubricants is sent down a well to force open cracks and fissures holding oil or gas.

Cuadrilla now plans to drill a second horizontal well through the Upper Bowland shale. It has planning consent granted to drill up to four horizontal wells on the site.

It plans to apply for consent to frac the first well.

“We plan to be in a position to hydraulically fracture both horizontal wells one and two in Q3 this year,” the company said.

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AJ Lucas said in its half year report the two companies had entered into a farm-out agreement with Angus Energy to sell 25 per cent from each of their interests in the Balcombe exploration licence in southern England.

Angus Energy will pay £4 million, shared 25 per cent to AJ Lucas and 75 per cent to Cuadrilla.

Cuadrilla owns licences to explore in Lancashire, Kent, Surrey, Sussex and Yorkshire.

The Preston Road site has been subject to constant protests by people opposed to fraccing.

In October last year, the UK government overruled the Lancashire county council to give Cuadrilla the go ahead to begin drilling.

AJ Lucas shares closed Tuesday down 3 per cent at 31.5c.

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