Red Sky to join hunt for Surat CSG
PERTH-based junior Red Sky Energy is set enter the coal seam gas industry by acquiring an interest of up to 100% by farming into two highly prospective coal seam gas permits in the Surat Basin.
The company said it had entered into an agreement to acquire 100% of the issued capital of Cydonia Resources with the rights to earn an interest of up to 100% in two CSG permits, ATP 840 and 904.
The two permits cover 1700 square kilometres and are near existing and planned gas infrastructure.
The permits are also adjacent to the major CSG fields held by BG Group and the Origin Energy/ConocoPhillips Australian Pacific LNG venture.
Red Sky said the permits had the potential to host combined in-place resources of 8 trillion cubic feet, and any discovery would have numerous development options given the close proximity of infrastructure.
The company plans to acquire Cydonia through the issue of 150 million fully paid Red Sky shares together with 150 million Red Sky options exercisable at 0.04c each within five years after the date of issue.
Cydonia shareholders will also be entitled to receive an additional 150 million fully paid Red Sky shares if specific milestones are met and achieved within a set period of time.
Red Sky will also carry out a placement of 200 million new fully paid shares at an issue price of 0.02c per share to raise $4 million as the acquisition is subject to the company holding no less than $4 million in cash on completion of the purchase.
Once the transaction is complete, Cydonia will become a wholly owned subsidiary of Red Sky.
Tuesday, 28 July 2009
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