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COMET RIDGE LIMITED Capital/Financing Update 2007
64686_rns_2007-02-07_dbad373a-8f43-49d4-8cc2-3315f9e08ef8.pdf
Capital/Financing Update
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COMET RIDGE LIMITED ASX ANNOUNCEMENT 8 FEBRUARY 2007
The Company Announcements Officer Australian Stock Exchange Limited Exchange Centre 20 Bridge Street SYDNEY NSW 2000 By Electronic Lodgement
PROJECT UPDATE - TIPTON WEST, SE QUEENSLAND
MAIN POINTS
- Gas sales commenced ahead of schedule
- Comet Ridge owns a 1.5% royalty on the well head value of gas produced
- Gas production volume projected to be 27 TJ/d by year end
- Revenues to Comet Ridge forecasted to be around AUD\$200,000 per year
The directors of Comet Ridge Limited (ASX Code: COI) are pleased to advise that gas sales from the initial 85 well development of the Tipton West coal seam gas project in south eastern Queensland have commenced.
Comet Ridge will receive 1.5% of the wellhead value of the gas produced from the project until it has received a total of AUD\$8 million. The field is expected to be producing in the order of 27 TJ/day by the end of 2007. At this level of production, Comet Ridge is forecasting revenues in the order of AUD\$200,000 per annum. Expansion of the Tipton West field, and development of other projects that Comet Ridge has a royalty over, is expected to increase the revenue stream in future years.
Attached is an announcement released by Arrow Energy NL, operator of the project, on 7 February, 2007.
Yours sincerely
ANDREW LYDYARD Managing Director Comet Ridge Limited
For further information contact: Andy Lydyard (USA) Managing Director Phone: +1 (303) 226 1303 $+1$ (303) 226 1301 Fax: Mobile: +1 (303) 547 4478 Email: [email protected]
AUSTRALIA Level 9, Wesfarmers House 40 The Esplanade, Perth WA 6000 Phone: 61 8 6464 0499 61 8 6464 0498 Fax:
USA 600 17th Street, Suite 600-S Denver, Colorado 80202 Phone: +1 (303) 226 1300 Fax: +1 (303) 226 1301
Comet Ridge Limited ABN 47 106 092 577 Email: [email protected] Website: www.cometridge.com.au
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7 February 2007
FOR IMMEDIATE RELEASE
First Gas Sales from Tipton West Field Almost Two Months Early
The Board of Arrow Energy N.L. ("Arrow") is pleased to announce that first gas was sold yesterday from the Tipton West Field to the Braemer Power Project ("BPP").
Under the terms of the Gas Sales Agreement ("GSA"), first gas deliveries were required by 31 March 2007. In a tight market for labour and materials, the project development has been well executed with the total elapsed time from project development decision to first gas sales being approximately 13 months.
Dewatering of the field began from a limited number of wells in the second half of calendar 2006 and further wells continue to be brought on stream. To date approximately 45 of the 85 wells drilled (inclusive of an additional 10 wells drilled to take advantage of rig availability) have been put on pump and have commenced dewatering. The remaining wells will be added over the next 3 months. Commissioning of the gas compression and related facilities is now under way enabling first gas sales to be made.
Initial gas flow into the BPP export line was at a rate of approximately 4 TJ/day and is stabilising at around 2.5 TJ/day. Sales will be intermittent over the next few weeks during the commissioning phase. Post commissioning, gas deliveries as required under the GSA will ramp up from a low rate in April 2007 rising to the full requirement of 16 TJ/day by 1 October 2007. Field production forecasts show a rate of 27 TJ/day should be achievable by year end from the project.
All of Arrow's field development in the Surat targets a well spacing of approximately 160 acres. Analysis shows that this spacing gives the optimal gas production profile over the life of the well to meet the required long term supply commitments under the GSA, whilst minimising the requirement for later expenditure on subsequent wells to maintain rate and hence maximising full field economics.
The Tipton West Project is a joint venture between Arrow (60%) and Beach Petroleum (40%).
Combined upstream and downstream development costs for the 10 PJ p.a. project was approximately \$71m (for the original 75 well development) with Arrow's net capital contribution being approximately \$7m, following the previously announced upstream farm-in by Beach Petroleum and the downstream funding arrangement with the Australian Pipeline Trust.
Tipton West is Arrow's fourth producing project, following on behind Moranbah, Kogan North and Daandine. At the start of this year, Arrow operated projects accounted for approximately 15% of gas sold in Queensland. It is estimated that this will rise to 25% by the end of this year as all projects continue to ramp up production.
Kerry J. Parker Company Secretary
Arrow Energy NL
ACN 078 521 936 Level 13, 10 Eagle Street, Brisbane QLD 4000, Australia GPO Box 5262, Brisbane QLD 4001, Australia Telephone: 07 3105 3400 Facsimile: 07 3105 3401 Email: [email protected]
For further information contact:
| Mr Nicholas Davies, Chief Executive Officer | l Phone. | 61 7 3105 3400 |
|---|---|---|
| Mr Stephen Bizzell, Executive Director | Fax: | 61 7 3105 3401 |
| Mr Kerry Parker, Chief Financial Officer | [email protected] | |
| website www.arrowenergy.com.au |