Crogga has been given yet another extension in ongoing talks over the variation of its licence to extract gas from the Manx seabed.

A decision on whether the island-based energy firm could go ahead with drilling an exploratory well was due to have been made by the end of October.

But the Department of Infrastructure has announced that a short further extension of seven weeks has been agreed.

It said this was to finalise matters in relation to a ‘small number of outstanding issues’.

If the application is approved this would allow Crogga to drill an exploratory well based on a 2D survey rather than a 3D one as currently stipulated.

Crogga Ltd was first awarded a licence in October 2018 to carry of a 3D seismic survey and drill an exploratory well.

That licence has already been extended three times - the first time in December 2021 for a period of four months and then a 27-month extension was granted. That ran out at the end of July this year but then the government agreed to a further three-month extension.

In a statement posted on Facebook, the DoI said: ‘The Department of Infrastructure and Crogga Limited are working together to cover a small number of outstanding issues in relation to varying the terms of the company’s Seaward Production Innovative Licence.

‘The process is now in its closing stages, and a short extension period of seven weeks has been agreed between the two parties to finalise matters.’

‘The licence currently requires the company to undertake a work programme as part of Phase B, which includes a 3D seismic survey, prior to moving to exploratory drilling in Phase C. The variation request would allow drilling on the basis of a 2D survey.’

Crogga estimates sales of 660 billion cubic feet of natural gas from the Crogga field off the coast of Maughold over the 19-year life of the field.

It says this could generate £2.8bn in revenues and royalties for the Treasury and create net income of £2.5bn for Crogga shareholders.

If the variation is granted, Crogga says it will restart fundraising with Manx residents and institutional investors for the £32.5m needed to drill the appraisal well.

Earlier this month, the company announced it has been accredited as a licensed operator in the UK and is planning to drill a test well off the coast of Blackpool next year.

In a letter to shareholders, chief executive officer Richard Hubbard admitted that the company has ‘lacked credibility’ with the DoI.

He said the Crogga UK subsidiary had secured accreditation with the North Sea Transition Authority (NSTA) which has approved the assignment to the company of a block containing the undeveloped Ronaldsway gas field - which despite is name is actually much closer to the UK coast.

Crogga says it plans to drill the Ronaldsway appraisal well late in 2025 and then, subject to international-standard drilling regulations being enacted in the Isle of Man, to then move the rig to drill the Independence test well in Manx waters in 2026.

Three60 has been appointed well operator.

Crogga Ltd is listed on the NSTA website at having a 100% interest in block 110/9c. It currently states ‘no operator’.

Later this month, Crogga founder and former chief executive officer Diccen Sargent is due to take the company to the employment tribunal. Mr Sargent is claiming unlawful deduction of pay against holding company Crogga Energy Ltd and its subsidiary Crogga Operations Ltd.

Crogga Operations was placed into voluntary liquidation in February this year. Documents at Companies Registry show that the company owed more than £1.7m which includes a claim for £128,800 from Mr Sargent.

The tribunal hearing will take place over four days from November 26-29.