The funds raised by the offer are to be used primarily for the development of Amity's two new gas discoveries at Adatepe and Cayirdere in Turkey without impacting on Amity's current exploration program. Any excess funds will be used for general working capital purposes.
In the event that the offer is not fully subscribed or does not proceed Amity will still continue with the development of Adatepe and Cayirdere but may need to defer some of its planned Turkish exploration expenditure until this can be funded from operating cashflow or other sources.
The Adatepe gas discovery is located 6km east of the JV's Gocerler gas field, in Turkey's Thrace Basin.
The development plan of the Adatepe discovery includes a 16km pipeline to deliver gas directly to customers in the Cerkeskoy Industrial area. The capacity of the line will be up to 37mmcfd and a gas processing plant will be constructed on the field.
Production is planned to begin before the onset of severe winter conditions in December with an initial plant capacity of 10mmcfd, which is designed to be rapidly doubled by adding a second separation module.
The budget for the initial Adatepe plant and pipeline is $US2 million and the two wells $US1.8 million. Amity will operate the Adatepe project.
The Cayirdere gas discovery is located about 33km east of the Gocerler gas field with partner TPAO operating a two well appraisal/development well drilling program.
Further wells will be considered after the results of a planned 3D seismic survey are available.
A 9km pipeline, with a capacity of 10mmcfd, is planned to connect the discovery to the TPAO trunk pipeline system and then to industrial gas customers. A gas processing plant with a capacity of 10mmcfd will be constructed near the discovery well.
The budget for the Cayirdere plant and pipeline is $US0.71 million and the two wells $US1.4 million. TPAO will operate the Cayirdere project.