Cuadrilla says it could only partially test shale well UK rules...

• Cuadrilla says it could only partially test shale well
• UK rules demand fracking work halted if tremors detected
• Environmentalists oppose new gas development

CUADRILLA SAYS SHALE WELL IN NORTH ENGLAND PRODUCED PEAK GAS RATE OF 200,000 SCF/DAY, STABLE RATE OF 100,000 SCF/DAY CUADRILLA SAYS UK WELL FLOW RESULTS SUGGEST RANGxE OF 3 MLN-8 MLN SCF/DAY WHEN ALL STAGES EFFECTIVELY HYDRAULICALLY FRACTURED CUADRILLA SAYS HAS ASKED BRITISH REGULATOR TO REVIEW RULES ON SEISMIC ACTIVITY TO ALLOW MORE EFFECTIVE FRACKING Tests of the first shale well at Cuadrilla's site in northwest England show a rich reservoir of high quality and recoverable gas, the British firm said on Wednesday, adding that rules that have constrained its testing work should be eased.

Cuadrilla is using a technique called hydraulic fracturing that involves injecting water and chemicals at high pressure to break up rock and extract gas. The practice, known as fracking, can cause tremors and environmentalists oppose the development.

The company repeatedly stopped operations last year at its Preston New Road site in Lancashire because of minor seismic events. British regulations demand work be suspended if seismic activity of magnitude 0.5 or more is detected.

Cuadrilla said it could only partially test the horizontal shale well because of the operating limits.

"Nonetheless the natural gas still flowed back from the shale at a peak rate of over 200,000 standard cubic feet (scf) per day and a stable rate of some 100,000 scf/day," Chief Executive Officer Francis Egan.

Scaling up the results suggested a flow range of between 3 million to 8 million scf/day for a 2.5 km (1.6 miles) section once all stages were hydraulically fractured, Cuadrilla said.

"We have also confirmed that the Bowland shale formation fractures in a way that, from U.S. experience, is typical of an excellent shale gas reservoir," Egan said.

Fracking techniques were pioneered in the United States, which has turned from an importer of gas to a net exporter.

Cuadrilla said more production data was needed to refine the preliminary results and this could only be done if seismicity limits are lifted to allow more effective fracturing.

The firm has asked the regulator to review rules on seismic activity to allow more thorough testing of exploration wells.

Depending on the outcome, Cuadrilla plans to complete fracking its first well at Preston New Road, start a second and carry out flow testing of both later this year.

Environmentalists have campaigned against the work, saying extracting more fossil fuel is at odds with Britain's commitment to reduce greenhouse gas emissions.

But the government wants to cut reliance on imports of gas, which heats about 80 percent of British homes.

The British Geological Survey estimates shale gas resources in north England could reach 1,300 trillion cubic feet (tcf), 10 percent of which could meet Britain's demand for about 40 years.

Cuadrilla is 47.4 percent owned by Australia's AJ Lucas (AJL) and 45.2 percent owned by a fund managed by Riverstone.