Exoma to seal Galilee CSG deal within a month
EXOMA Energy expects to complete its acquisition of the Galilee coal seam gas project this month after the project’s five permits were granted by the Queensland mines and energy minister.
Once the permits have been transferred to Longreach, the acquisition will be complete. The transfer is expected to take 30 days.
In May, Exoma announced its intention to acquire the project, which covers an area of 26,840 square kilometres, from Longreach.
Under the agreement with Longreach, Exoma will issue about 114 million fully paid shares and the same number of options exercisable at 10c each to Longreach shareholders.
Longreach will also be entitled to receive around 114 million performance shares which it may convert to ordinary shares if specific milestones, based on exploration success or share price performance, are achieved within set periods of time.
Following the transaction, Longreach will become a wholly owned subsidiary of Exoma.
Exoma expects to spend about $47 million on drilling over the next four years to prove up the potential of the project, which adjoins Galilee Energy’s Rodney Creek
The company said it was confident, subject to the transfer of the permits and completion of technical assessments, that the initial drilling program – comprising of at least three wells to test coal thicknesses and permeability – would start in the fourth quarter.
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