Metgasco Ltd today announced the launch of a Share Purchase Plan (SPP) to fund the Company’s development program for first gas sales and a high impact exploration program.
Under the SPP, Eligible Shareholders will be entitled to apply for up to $15,000 in additional shares.
Background to the SPP
Australian energy markets are experiencing rising demand for gas which offers a clean, low carbon emission fuel supply for industry and power generation. In addition, there is growing international demand for Australian LNG.
Over the past 12 months Metgasco has:
– Completed the first reserve drilling program in PEL 13 where it expects to receive a reserve upgrade in the coming quarter;
– Completed drilling the next generation of CSG multilateral wells in PEL 16 which are currently dewatering and showing positive early signs of gas production;
– Completed a targeted seismic survey over several conventional leads and prospects in the Clarence Moreton basin and identified a number of potentially high impact conventional targets; and
– Completed a detailed study into the feasibility of supplying gas to existing and potential new LNG projects in NSW and Qld which found that several LNG project options are economically attractive at prevailing export LNG prices.
Metgasco is currently pursuing these large scale LNG supply opportunities vigorously.
At the same time that the Company pursues its export sale agenda Metgasco remains focussed on progressing high impact exploration opportunities and delivering gas and gas fired power to customers and households in local area.
Proceeds raised under the SPP will be combined with proceeds raised under the recent successful Placement and Metgasco’s current cash reserves and will be applied to:
– Supply of gas to customers in the Northern Rivers region of NSW and development of Stage 1 of the Richmond Valley Power Station (6 MW). These activities will generate first revenue for the Company;
– Reserve development and Licence Commitment drilling in PEL 13 and PEL 426;
– The drilling of the potentially high impact Rosella E01 well on the Mackellar North structure. This structure is located to the north of Metgasco’s Kingfisher discovery and has a P50 OGIP estimate of 1,312 Bcf; and
– Ongoing working capital requirements.
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Source: Metgasco, June 20, 2011;