The capital raising comprises a placement of 33.9 million fully paid ordinary shares to a range of institutional and sophisticated investors at an issue price of 75c per share to raise $25.4 million before issue costs.

In addition, shareholders on the register as of Friday, May 11 will each be able to apply for up to 6666 shares at 75c apiece for a maximum investment of $5000. This will raise up to a further $4.6 million.

Sunshine Gas managing director Tony Gilby said the funds would mainly be used to rapidly advance the company’s Lacerta Walloon coal seam methane project and its Overston conventional gas development.

“The company is targeting certified 2P reserves of 244 petajoules from Lacerta by June and 180PJ from Overston by December 7,” Gilby said.

Some of the proceeds will also be used to advance several of the company’s other prospective exploration projects, including the Pegasus and Atria Permian CSM projects in Queensland.

Gilby said the placement had received strong support from existing shareholders and had also led to the introduction of new institutional investors to the company’s register.

Settlement of the placement shares is expected to occur on Tuesday, May 8.

Full details of the SPP offer for existing shareholders will be sent to them by Tuesday, May 15. Acceptances under the SPP offer will close on Thursday, May 31 with the shares expected to be allotted on June 12.