AUSTRALIA

ASX fears dollars don't add up

THE Australian Stock Exchange has queried two junior petroleum firms, Westralian Gas and Power and Gas2Grid, over whether they have enough funds to continue their respective future work programs.

ASX fears dollars don't add up

Both companies posted zero sales revenue for the June quarter, with Westralian reporting an outgoing cash flow of $570,000 and an end-June bank balance of $824,000. Likewise, Gas2Grid spent $847,652 during the three-month period and had cash totalling $810,605.

In response to the query, Westralian attributed its spending to several one-off payments, including $110,000 for its two Kentucky leases and $50,000 to farm-in with Red Mountain Energy to several Western Australian coal seam methane tenements.

“The expenditure of funds will therefore be substantially less in the current and future quarters for its current operations,” executive chairman Peter Briggs.

“It is the company’s intention to fund the new projects, being the offshore oil and gas permits [in the Vlaming Sub-Basin, offshore Perth] by joint venture or farm-in arrangements.”

Westralian also said it had received its first cheque from oil sales at the Kentucky leases, which it expected to generate at least $415,000 net revenue per year.

“The company is also seeking it improve production from these wells and commence production from other wells on the leases, which have been dormant for some years.”

Meanwhile, Gas2Grid told the ASX that its spending during the June quarter was higher than usual, due to the costs involved in drilling the Nuevo Malolos-1 well in Philippine licence SC44 in the three months to end-March 2006.

Before committing to a future work program, the Sydney-based explorer said it was waiting to complete its interpretation and assessment of the drilling results from Nuevo Malolos-1.

“The company has sufficient funds to meet all its liabilities,” Gas2Grid said.

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