24/05/2005 - 22:00

Progress on coal seam project

24/05/2005 - 22:00

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Perth company Comet Ridge has reported positive results from its Tipton West coal seam methane gas project in Queensland, adding to hopes it may join the ranks of gas producers in the region.

Progress on coal seam project

Perth company Comet Ridge has reported positive results from its Tipton West coal seam methane gas project in Queensland, adding to hopes it may join the ranks of gas producers in the region.

Comet Ridge is one of eight companies in Queensland and NSW seeking to develop coal seam gas projects, which are seen as an alternative to long-distance pipelines from remote gas fields.

Western Australia has its own aspiring coal seam methane gas producer in Peter Briggs’ Westralian Gas and Power, which floated this year after raising $4 million.

While some coal seam gas companies like CH4 and Sydney Gas are already in production, most are still in the drilling and exploration phase.

Comet Ridge (20 per cent) and its partner Arrow Energy (80 per cent) are continuing with a drilling program at Tipton West to confirm the size of their gas resource.

They announced last week that an independent reservoir engineer has certified Tipton West’s proven and probable reserves at 143 petajoules, while possible reserves are in excess of 2,000 petajoules.

Comet Ridge managing director Andy Lydyard said reserve certification meant the company had delivered on the strategy it floated on last year.

It plans further drilling to expand the certified reserves and intends to negotiate binding gas sales agreements with a view to achieving financial close by the end of September.

Comet Ridge and Arrow Energy have already signed conditional gas sales contracts with Ergon Energy, BP and ERM Wambo Power totaling 123 petajoules.

First sales from the Tipton field are scheduled for October 2006 at the rate of 10.2 petajoules per annum.

Mr Lydyard said the company would need to raise additional capital to fund the development, and may be able to raise debt capital as well as equity.

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