13/09/2007 - 15:40

Greenpower launches $10m initial public offer

13/09/2007 - 15:40

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West Perth-based coal seam gas developer Greenpower Energy Ltd will aim to raise up to $10 million to acquire and develop a suite of tenements across Australia in its inital public offer, the company has announced.

Greenpower launches $10m initial public offer

West Perth-based coal seam gas developer Greenpower Energy Ltd will aim to raise up to $10 million to acquire and develop a suite of tenements across Australia in its inital public offer, the company has announced.

The company will issue 40 million shares at 20 cents each to raise $8 million and allow for oversubscriptions of 10 million shares to raise a further $2 million.

The company, originally incorporated as Gunnedah Colliery Company Ltd, has two hydrocarbon exploration permits in the Perth Basin in Western Australia.

In 2007, the Company entered into a contract with Planet Gas Ltd to acquire companies holding eight exploration licences for CSG in Victoria, seven of which are located in the Gippsland Basin and one of which is located in the Otway Basin.

In addition, the Company has contracted with Planet Gas to acquire a share in one exploration licence located in the Gunnedah Basin in New South Wales, the direct purchase of two tenements in the Otway Basin and the acquisition of two further tenements in the Eromanga and Willochra Basins in South Australia.

Greenpower is chaired by European Gas Ltd director Alan Flavelle, with Oakbridge Ltd director Ron McCullough, Astron Ltd chair Gerard King and Takanao Mitsui serving as non-executive directors, with Matt Suttling serving as company secretary.

The company has retained BDO Kendalls Audit and Assurance as auditors and BDO Kendalls Corporate Finance as investigating accountants. Price Sierakowski will provide legal advice to the offer.

The offer, which opened this week, will close on October 8.

 

 

The full text of a company announcement is pasted below

13 September 2007: Greenpower Energy Limited (ASX: GEL) is seeking up to $10 million in a public share offer to acquire and develop a suite of coal-seam gas (CSG) tenements across Australia.

The company believes it has the experience to develop its two million hectares of commercially-attractive tenements and to extract natural gas from them to sell to electricity producers and gas marketers.

The issue opens this week and closes on 9 October 2007. The share offer seeks to raise a minimum of $6 million (30 million 20 cent shares) and a maximum of $10 million (50 million shares). The issue is not underwritten as the company already has 1,499 shareholders on its books.

Greenpower Energy Limited was initially incorporated as Gunnedah Colliery Company Limited mining coal at Gunnedah NSW in 1899 and stopped mining coal when it sold the mine in 1997. Together, its present four directors have significant experience in companies engaged in coal, oil and gas exploration and production.

GEL has two hydrocarbon exploration permits in the Perth Basin in Western Australia. Its Victorian interests include an agreement with Planet Gas Ltd to acquire seven methane exploration licences in the Gippsland Basin and the Otway Basin. In South Australia tenements are in each of the Eromanga and the Willochra Basins. GEL also has an operation in NSW with a share of one tenement in the Gunnedah Basin.

In the US, coal seam natural gas - also called coal bed methane - is now a mature industry that provides some 12 percent of the country's natural gas production. Modern exploration and completion techniques have led to exponential growth of CSG in both the US and Australia.

Funds raised in the issue together with potential cashflow from operations will be used in the exploration and development of the company's extensive holdings. Future acquisitions of potential CSG tenements with accessible infrastructure will also be targeted.

The directors of GEL are the chairman Alan Favelle, who has been involved in CSG developments since 1984, Gerard King, Ron McCullough and Takanao (Tony) Mitsui.

Methane or natural gas from coal seams has the potential for use as reticulated gas, as a fuel for the generation of electricity and as a feed stock in the production of methanol and other chemicals.

The lower yield of carbon dioxide per unit of energy produced when burning methane compared to oil and coal is a significant environmental advantage.

In the Gippsland Basin GEL plans to drill up to eight test wells in the first six months to verify the economic viability of drilling up to 30 production wells in the ensuing program.

In the Perth Basin, GEL plans to collect data in the first year and drill in both areas within the first two years.

The projects in the Otway Basin in Victoria, the Eromanga and the Willochra Basins in SA and the Gunnedah Basin in NSW are all early stage exploration projects for which the company is preparing initial exploration.

Shareholders in Planet Gas, which is vending the Victorian, NSW & SA areas to GEL, and EGL which is vending the WA areas get priority in subscribing to Greenpower Energy's share offer by not being cut back before other applicants if there are applications over the maximum subscription.

GEL will explore for, assess and, if commercially attractive, develop the tenements with the aim of extracting, lifting, transporting and selling natural gas to electricity producers and gas marketers. The directors believe the GEL projects have significant resource potential that will actively grow shareholder value by successfully exploiting them.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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