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Proceeds from the offer will be used predominantly to fund the exploration, appraisal drilling and development of the CBM Esponda Project in the Powder River Basin in Wyoming, USA and the exploration and appraisal drilling of the company's CBM projects in Australia.
Planet Gas will be admitted to the official ASX list this Thursday and will trade under the code PGS.
Company chairman Norm Seckold said the funds would be evenly split between the US and Australia although the Wyoming project would be the first into production this year.
"With our joint venture partners in the US we have already drilled 20 wells with a 100% success rate in the Powder River Basin. The Basin already has a fantastic track record of CBM production from nothing in 1994 to one billion cubic feet per day at the moment from 10,000 producing wells. Now we aim to be a part of that production growth," said Seckold.
The Esponda leases are known to overlay Wasatch and Fort Union Formation coals including the Felix, Bull Creek and Big George seams. These coals are producers of CBM throughout the Basin. Cumulative coal thickness across Esponda Project ranges from 40 feet (12 metres) to more than 190 feet (58 metres).
The company's Australian assets include five sedimentary basins in three Australian States. The tenement holdings total approximately 2.0 million hectares (4.9 million acres) and in most cases are proximate to infrastructure that may facilitate the sale of production that is achieved.
"In Australia our primary focus will be on our Gippsland Basin holdings due to its local to Melbourne, along with the electrical supply infrastructure to three million of Victoria's population, and our 100% holding of the Wonthaggi coalfield," Seckold added.
Planet Gas has acquired all its assets through outright purchase, joint venture and direct licence application with a view that the projects have the potential to contain feasible CBM reserves that can be brought into production.
The eastern blocks of the Esponda Project, Wyoming are currently under development with production expected in calendar 2004.
