Comet plans $7.6m capital raising

COMET Ridge hopes to raise $7.6 million through a non-renounceable rights issue to gain more working capital and fund its oil and gas drilling and exploration activities in the United States and Australia.
Comet plans $7.6m capital raising Comet plans $7.6m capital raising Comet plans $7.6m capital raising Comet plans $7.6m capital raising Comet plans $7.6m capital raising

The company today said under the issue of about 28.3 million shares, shareholders would be offered two shares for every five shares held at 27c per share. The offer is open until June 29, 2007.

Comet Ridge said the funds would contribute to projects including its upcoming drilling program on the Tow Creek and Bear River prospects in Routt County and the acquisition of 3D seismic and drilling in its Florence project in Fremont County, both in Colorado.

The company said the funds would also be used to fund its share of a multi-well drilling program planned for the Cedar Creek/Vader prospect areas in southern Washington and the acquisition of new seismic data aimed at developing drillable prospects for end-2007.

Meanwhile, Comet Ridge said the Cyclone Drilling Rig-16 has arrived at its Coal View Unit 31-4 (CVU 31-4) on the Tow Creek project in Routt County and is now in the process of rigging up.

The well is expected to spud early next week due to delays resulting from shortage of trucking contractors, soft ground conditions and the steep climb to the location, which requires bulldozers to assist with the move.

CVU 31-4, the first well at Tow Creek, is designed to test three separate reservoir intervals in the Cretaceous-aged Niobrara Formation on the eastern flank of the Tow Creek anticline.

It will be drilled with a special aerated drilling mud system designed to minimise damage to the fractured reservoir.

The well is estimated to cost $US1.8 million ($A2.3 million) to drill, complete and equip.

CVU 31-4 is targeting gross recoverable oil reserves of 200,000-540,000 barrels of oil with upside potential in excess of 500,000bbl.

Comet Ridge is operator of Tow Creek with a 37.5% interest.

Comet Ridge and partner, Colorado Strike Oil, a wholly-owned subsidiary of Strike Oil, are each paying 50% of the cost of the first two wells, CVU 31-4 and Peltier 11-12 in the program. Thereafter the companies will pay their working interest share.