30/07/2009 - 14:52

Sino Gas & Energy to raise $10m

30/07/2009 - 14:52

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Perth-based Sino Gas & Energy plans to list on the local stock exchange in the coming months as it prepares to launch a $10.3 million rights issue and initial public offer.

Sino Gas & Energy to raise $10m

Perth-based Sino Gas & Energy plans to list on the local stock exchange in the coming months as it prepares to launch a $10.3 million rights issue and initial public offer.

The company this week lodged its prospectus with the Australian Securities and Investments Commission.

Patersons Securities has agreed to underwrite around $7 million of the rights issue and IPO.

Sino, which anticipates listing in early September, plans to take its tight gas sands project in China's Ordos Basin to development.

 

 

The announcement is below:

 

 


Sino Gas & Energy Holdings Limited (SGE) has announced plans to launch a 1 for 3 Rights Issue expected to raise up to $9.8million together with an Initial Public Offering (IPO) raising $500,000 and to list on the Australian Securities Exchange (ASX). The Rights Issue is underwritten to $7million by Patersons Securities.

The emerging energy producer's ultimate strategy is to take its tight gas sands project in the Ordos Basin in central China to development. Proceeds from the raising will be used to fund the first stage of a further appraisal work program over the 12 month period post admission to ASX, involving the drilling of a number of new wells and tests.

The second stage aims to complete the appraisal program targeting the upgrade of current Contingent Resources to Reserves.

Driving the program is our skilled and highly experienced board, management and operations team that has significant Oil and Gas exploration and development experience and has generated significant value over the first three years of operatorship.

Stephen Lyons, Managing Director of Sino Gas & Energy said: "SGE is at a very exciting stage of the development of its gas projects in the Ordos Basin, which will allow it to take full advantage of growing Chinese demand for clean and affordable energy".

Under the Rights Issue, eligible shareholders are being offered 1 new share at a price of $0.25 per share for every 3 shares held, together with 1 free attaching 2010 $0.25 Option and 1 free attaching 2011 $0.50 Option for each new share issued. The IPO price is $0.25 per new share, again with an attaching free 2010 $0.25 Option and a free 2011 $0.50 Option for each new share issued.

SGE has conducted extensive work on its projects since calendar 2006 resulting in large scale independently verified gas resource positions of 9.1Tcf Gas In Place with total Recoverable Resources (Contingent and Prospective) of 2.7Tcf. Net to SGE, "mid case" Recoverable Resources total 1.7Tcf with a "risked" potential value exceeding US$400million.

Further detail in relation to the Rights Issue and IPO is provided in the prospectus that was lodged with the Australian Securities and Investments Commission (ASIC) on 29 July 2009. A copy is available online at the company's web site www.sino-gas-energy.cn

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