COMET RIDGE LIMITED — Capital/Financing Update 2004

Oct 25, 2004

26^th October 2004

Company Announcements Office Australian Stock Exchange Limited $10^{th}$ Floor 20 Bond Street SYDNEY NSW 2000

Dear Sir

POWER GENERATION DEAL ANNOUNCED

Comet Ridge Limited (ASX code: COI) has been advised by the Operator of ATP 683P Dalby, Arrow Energy NL (ASX code: AOE) (Arrow), that Arrow has entered into a Letter of Intent (LOI) with NSW Government owned Country Energy (one of Australia's largest electricity retailers) to develop two gas fired electricity generation projects near Dalby and Kogan in southeastern Queensland. The two projects will be capable of generating 27.4MW of electricity for sale into the National Electricity Market grid.

The gas will be sourced from a number of fields including the Tipton West field in ATP 683P where Comet Ridge owns a 20% interest.

This is latest of a number of marketing arrangements that seek to establish markets for gas close to Tipton West and to accelerate cash flow from the project. The LOI contemplates a commissioning date in the $2^{nd}$ or $3^{rd}$ quarter of 2005.

The Managing Director of Comet Ridge Limited, Mr. Andy Lydyard said "we are very pleased to be part of the power generation project announced by Arrow, this is another important step towards the commercialisation of the Tipton West coal seam gas field."

Yours faithfully

Andy Lydvard Managing Director

For further information contact:

Andy Lydyard Managing Director Tel: (08) 9225 7108 Fx: (08) 9225 6100

Tony Dawe Ward Holt Corporate Communication Tel: (08) 9221 8722 Fx: (08) 9221 8733

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