IPO on the Australian Stock Exchange
Brisbane, Oct 10, 2017 AEST (ABN Newswire) - Brisbane-based gas conventional gas developer State Gas Limited (ASX:GAS) is pleased to announce that its shares will commence trading on the Australian Securities Exchange (ASX) today (Tuesday, 10 October 2017).
The ASX-listing of State Gas represents the first IPO of an east coast gas developer-explorer since 2006.
The State Gas IPO was heavily oversubscribed and closed early, after raising $5.25 million during October at an Offer Price of $0.20. The Company will have a market capitalisation of $26.9 million (at the Offer Price).
State Gas Limited is Operator of and holds a 60% interest in a proven conventional gas field (Reid's Dome) in the Bowen Basin in Central Queensland, discovered in the 1950s. The gas field is secured by a granted petroleum lease (PL 231) located approximately 30 km southwest of Rolleston.
PL 231 hosts a conventional gas project located in the Denison Trough, first discovered in the 1950s. PL 231 is not a coal seam gas target.
State Gas Chairman, Tony Bellas, said that the primary area of focus for State Gas is the shallow, conventional gas target in the Cattle Creek Formation - less than 200m deep, with a major secondary target in the underlying Reid's Dome beds.
"Both targets have produced gas during the drilling of exploration and appraisal wells on PL 231. A number of historical wells have flowed gas from the Cattle Creek Formation, which was reached at depths of as shallow as 130 metres", he said.
"The shallow nature of this conventional target will greatly benefit the economics of the appraisal and development wells that State Gas intends to drill in PL 231 in the period following its admission to ASX.
Mr Bellas said that the underlying Reid's Dome beds are anticipated to be at least 2,770 metres thick and have not been fully tested in the Denison Trough. "They provide an exciting future target for State Gas."
In order to accelerate the options for bringing gas from PL 231 to market, State Gas has recently lodged a pipeline survey licence application with the Queensland Department of Natural Resources and Mines (PSL 2028) with the intention to investigate suitable routes for a feeder pipeline to connected PL 231 with the Queensland Gas Pipeline and the broader east coast gas market.
Mr Bellas said that it was an exciting time to be an investor in the supply side of the Queensland gas market, with the gas industry on the east coast undergoing significant structural change with the growth of demand from the Queensland-based LNG export industry causing a tight supply market.
"The Board has a preference, where possible, for maintaining any gas developed from PL 231 as uncontracted in order to maintain flexibility to take advantage of spot market opportunities," he said.
State Gas has assembled an outstanding board with relevant leadership, project development and petroleum industry experience. In particular, the Company is fortunate to have secured Ian Paton as a technical non-executive director. Mr Paton is a geophysicist and petroleum engineer with substantial oil and gas industry experience. He began his career with BHP in 1976 as a geophysicist and worked in senior exploration and development roles in Santos and Conoco over the next two decades before becoming a consultant. Mr Paton is former Manager of Exploration and Development for Santos.
The State Gas Board also includes Mr Robert Towner, representing 35%-shareholder Triangle Energy (Global) Limited, and energy entrepreneur and substantial shareholder Mr Greg Baynton, as an Executive Director.
About State Gas Limited
State Gas Limited (ASX:GAS) is a Queensland-based developer of the Reid's Dome gas field, originally discovered during drilling in 1955, located in the Bowen Basin in Central Queensland. State Gas is 100%-owner of the Reid's Dome Gas Project (PL-231) a CSG and conventional gas play, which is well-located 30 kilometres southwest of Rolleston, approximately 50 kilometres from the Queensland Gas Pipeline and interconnected east coast gas network.
Permian coal measures within the Reid's Dome Beds are extensive across the entire permit but the area had not been explored for coal seam gas prior to State Gas' ownership. In late 2018 State Gas drilled the first coal seam gas well in the region (Nyanda-4) into the Reid's Dome Beds and established the potential for a significant coal seam gas project in PL 231. The extension of the coal measures into the northern and central areas of the permit was confirmed in late 2019 by the Company's drilling of Aldinga East-1A (12 km north) and Serocold-1 (6 km to the north of Nyanda-4).
State Gas is also the 100% holder Authority to Prospect 2062 ("Rolleston-West"), a 1,414 km2 permit (eight times larger than PL 231) that is contiguous with the Reid's Dome Gas Project. Rolleston-West contains highly prospective targets for both coal seam gas (CSG) and known conventional gas within the permit area. It is not restricted by domestic gas reservation requirements.
The contiguous areas (Reid's Dome and Rolleston-West), under sole ownership by State Gas, enable integration of activities and a unified super-gasfield development, providing economies of scale, efficient operations, and optionality in marketing.
State Gas is implementing its strategic plan to bring gas to market from Reid's Dome and Rolleston-West to meet near term forecast shortfalls in the east coast domestic gas market. The strategy involves progressing a phased appraisal program in parallel with permitting for an export pipeline and development facilities to facilitate the fastest possible delivery of gas to market. State Gas' current focus has been to confirm the producibility of the gas through production testing of the wells.