15/04/2010 - 10:41

Eneabba higher on Cougar UCG deal

15/04/2010 - 10:41

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Shares in Eneabba Gas were higher after the energy outfit today entered a joint venture deal with Melbourne-based Cougar Energy for the development of its Mid West coal resources into an underground coal gasification project.

Shares in Eneabba Gas were higher after the energy outfit today entered a joint venture deal with Melbourne-based Cougar Energy for the development of its Mid West coal resources into an underground coal gasification project.

Both companies have signed a memorandum of understanding that paves the way for the establishment of a binding agreement to explore and study the Sargon tenement in the Mid West.

The work will contribute to a potential pilot plant for UCG near Dongara.

Eneabba recently announced it expects to lift the Sargon resource following a drilling campaign that identified additional coal mineralisation. The resource currently stands at 194 million tonnes with an in-situ energy yield of 3,037 petajoules.

Under the JV terms, both companies will each have a 50 per cent interest and will each contribute $1 million towards the initial drilling and technical work programs.

Shares in Eneabba climbed three cents, or 17.1 per cent, to 20.5c at 12:16 AEST.

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