"We are underwritten to $1.5 million [by major shareholder DGR Global], but that would not be satisfactory if that was all we got," he said.
"We'd chew through the money more quickly, but we would be putting the money in the ground, and at least we would be doing something, not just spinning our wheels as we have been doing for the past four years.
"We might last a year with that, but it would be enough to move on Bendee-1."
If the full $12.6 million is raised, almost half will be spent on ATP 1153, the block Lakes secures from Dark Horse Resources last year, after finding it was going to be stymied in Victoria by bi-partisan bans on fraccing for another four years.
The company wants to spend a further $1 million on its frontier assets in South Australia, $1.7 million would cover corporate costs and $3 million would be put aside for production facilities assuming success.
ATP 1183 sits between Armour Energy's Emu Apple oil field and Santos' Boxleigh gas-condensate field, and surrounds Armour's Riverslea oil field and gas-condensate field.
It is an area rich with potential, and one where both liquids and gas could be highly valuable.
If it raised only the underwritten portion of the capital raising, Lakes would move to retest the Bendee-1 well.
Drilled by BHP Billiton in 1981 to a depth of 1832m the well encountered oil shows but was ultimately abandoned - probably unfairly, Lakes believes.
The potential for by-passed pay was first noted by Dark Horse, and has been re-assessed by Lakes' Tim O Brien.
"They have gone through the logs and you can see there is a mismatch between two of the logs," Sleeman explained.
"They don't line up. When they drilled Bendee they flowed oil and water from the drill stem test, and when they narrowed it down they just got water.
"They tested lower, and it seems as if the perforations were not at the level where the oil, permeability and porosity are."
The plan is to re-enter the well, re-preforate the casing and see what comes to surface.
"We anticipate we will get a flow of oil," Sleeman said.
Bendee is to the east of the Major oil field, and the interpretation of the area from Major to Boxleigh in the east that any valid trap should be filled with liquids.
"If we can get a flow of oil it would give us a run on the board, and it's easy to do. It's not guaranteed, but we are as confident as can be," Sleeman said.
If it raises more cash Bendee would be the first of a three-well program that includes testing of the 41 billion cubic feet Wellesley Dome prospect the 13.8Bcf Major East prospect, a possible extension of the Major field.
The wells will cost around $2 million each, and could be transformational for Lakes.
They could not only establish its first modern production, but offer the chance to look at other overlooked areas, such as Martini, Riverslea Updip and Pembroke, all areas with shows that were discounted by past explorers.
Those wells are still being studied as options for re-entry, but Sleeman believes the ATP 1138 area could be a launching pad for the company after years of paralysis.
"The bigger companies, the Origins and Santos' just have high overheads, but we can make a buck out of something that they would be losing money on," he said.
It is for that reason Armour is redeveloping fields on the Roma Shelf, and Armour, where Sleeman is also a director, could be contracted to operate the wells as part of its wider Roma Shelf redevelopment.
There are also other fields in the area, owned by the likes of AGL Energy and Origin Energy, which could be on the market.
Beyond getting an oil and gas business off the ground in the Surat Basin, Lakes' other concerns are its litigation against the Victorian government and its frontier permits in South Australia.
The capital raising contains a modest budget for litigation costs, to help with Lakes; $2.7 billion compensation claim.
It will file its final claim soon in a case it says is based on derogation.
Lakes has spent more than $100 million in Victoria, defining the 329Bcf of gas (2C) in Wombat and 390Bcf in Trifon-Gangell, plus the potential for 11.4Tcf (P50) in the Portland Energy project, but has been paralysed for the past four years.
It's a big claim, and one Sleeman says Lakes has no real desire to wear all the costs.
"I will do my damnedest to get a litigation funder before this offer closes, because that is something that won't go unnoticed. It will be a real vote in confidence, and that is why we have included these performance rights," he told Energy News.
The performance rights will be awarded against the share price over five years, because it is possible the litigation could last that long as it heads to the High Court in Canberra.
Lakes only needs to have its share price rise to 0.8 cents per share, which could happen if Wellesley Dome comes in, or a settlement has been reached with the Victorian government, to trigger the performance rights.
At Wilkatana, because the area is a frontier play, Sleeman said Lakes would look to progress the licence applications through native title, and it may also talk to the owner of the overlapping mineral leases, to see if it can gain access to geological data that may focus its attention in a specific area of what was once a giant pre-Cambrian oil field.
The offer closes on March 17.