Cooper Energy Approves Sole Gas Project

By Glenn Dyer | More Articles by Glenn Dyer

Oil and gas developer Cooper Energy (COE) is looking to raise $151 million in an equity raising to help fund its new Sole offshore gas project in Victoria’s Gippsland Basin.

Cooper said yesterday its board had approved the project that will pipe gas to the Orbost Gas Plant from March, 2019 before being sold to customers through the Eastern Gas Pipeline.

The company said the Sole gas project is expected to cost $355 million, and will increase the company’s proven and probable reserves by 43 million barrels of oil equivalent (mmboe) from the 11.6 mmboe held at the start of the year.

Cooper Energy says its annual production is expected to lift from one mmboe for 2017 to six mmboe in the Sole project’s first full year of operation, still a long way short of the likes of local giants like Woodside, Santos and Oil Search, but a significant boost nevertheless for the company.

Last October, Cooper signed a deal with AGL and last week it has signed up a fourth customer in Energy Australia.

Late last month, APA agreed to spend the $250 million on the Orbost gas plant. The money reduces Cooper’s investment for the Sole project by 40% and led to yesterday’s fund raising announcement and project go ahead.

Cooper shares went into a trading halt during the institutional portion of the equity raising, with 150 million new shares issued to raise $47 million. The shares last traded at 38.5 cents.

The shares are valued at 31.5 cents, a discount on the 38.5 cents at which Cooper last traded.

A separate one-for-two non-renounceable entitlement offer will raise $104 million, with an institutional component conducted over Wednesday and Thursday and a retail component to run between April 5 and 21. The record date for the entitlement offer is March 31.

Euroz Securities and Canaccord Genuity are running the fund raising for Cooper Energy. The shares were halted at 38 cents.

Beach Energy owns around 10% Cooper, which some analysts say could be a springboard to a larger deal down the track.

Glenn Dyer

About Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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