Cooper Energy approves Sole development

PERTH (miningweekly.com) – The board of ASX-listed Cooper Energy has approved the development of the Sole gas project, offshore Victoria, with the company launching a A$151-million capital raise as part of its financing initiative to fund the project.

The Sole gas project is expected to require a capital investment of some A$533-million for its upstream development, with some 25 PJ/y to be produced from the Sole gasfield and supplied to users in south-east Australia.

Gas produced from the field will be piped to the Orbost gas plant, from where it will be supplied to customers through the Easter gas pipeline.

First gas from the project is expected in the March quarter of 2019.

Cooper Energy MD David Maxwell on Wednesday said the final investment decision, which was subject to securing financing, was a milestone event in the company’s gas strategy and would trigger a 43-million-barrel-of-oil-equivalent uplift to Cooper Energy’s 2P reserves, which is a near 400% increase to proven and probable reserves.

Based on the current ownership, the first full year of operation from Sole is expected to lift Cooper Energy’s yearly production to more than six-million barrels of oil equivalent, a significant increase on the one-million barrels of oil equivalent estimated to be produced in the 2017 financial year.

Meanwhile, Maxwell noted that the equity raising announced on Wednesday would provide shareholders the opportunity to participate in a transformational event for the company.

Cooper Energy will place 150-million new fully paid ordinary shares in an institutional placement, raising an initial A$47-million. A one-for-two accelerated nonrenounceable entitlement offer will raise a further A$104-million.

Both the institutional placement and entitlement offer will be priced at 31.5c a share, representing an 18.2% discount to the company’s closing price on March 28.

Cooper Energy said on Wednesday that the company was confident of securing debt financing for the remaining funding requirement for the Sole gas project during the June quarter of this year.