COMET RIDGE LIMITED - Capital/Financing Update 2009

Non-renounceable entitlement offer OFFER BOOKLET

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NON-RENOUNCEABLE ENTITLEMENT OFFER

A non-renounceable entitlement offer of 1 New Share for every 5 Shares held at an Issue Price of A$0.27 per New Share to raise approximately A$13.8 million

COMET RIDGE LIMITED ABN 47 106 092 577

This document is important and should be read in its entirety. You should contact your professional adviser about the contents of this Offer Booklet. The Offer Booklet is provided for information purposes and is not a prospectus or other disclosure document for the purposes of the Corporations Act. Accordingly, this Offer Booklet does not necessarily contain all of the information which a prospective investor may require to make an investment decision and it does not contain all of the information which would otherwise be required to be disclosed in a prospectus or other disclosure document.

The New Shares offered under this Offer Booklet have not been registered under the US Securities Act and may not be offered, sold or delivered in the United States or to, or for the account or benefit of, any US Person, except pursuant to applicable exceptions from registration.

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Lead Manager and Underwriter Wilson HTM Corporate Finance Limited ABN 65 057 547 323 1

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Important Information ....................................2 1. Key Offer Information................................4 2. Chairman’s Letter .....................................5 3. Details of the Offer....................................7 4. What Eligible Shareholders May Do........10

Company Overview and Effects of the Offer ................................................... 12 6. Risk Factors........................................ 21 7. Additional Information.......................... 26 8. Glossary ............................................. 34 9. Corporate Directory............................. 36

Important Information

The Corporations Act was recently amended to introduce the ability for listed companies to make a pro-rata entitlement offer of securities to existing Shareholders without a disclosure document. The Offer to which this Offer Booklet relates complies with the requirements of section 708AA of the Corporations Act as notionally modified by ASIC Class Order 08/35 and accordingly, this Offer Booklet is without disclosure under Part 6D.2 of the Corporations Act and is not required to be lodged or registered with ASIC. This Offer Booklet is provided for information purposes and is not, and does not purport to be a prospectus or other disclosure document for the purposes of the Corporations Act. Accordingly, this Offer Booklet does not contain all of the information which would otherwise be required to be disclosed in a prospectus or other disclosure document, and does not necessarily contain all of the information which a prospective investor may require to make an investment decision.

This Offer Booklet is dated 18 May 2009. Neither ASIC nor ASX, nor any of their officers or employees takes responsibility for this Offer or the merits of the investment to which this Offer relates.

Not investment advice

You should read this Offer Booklet in its entirety and refer to the releases made by Comet Ridge to ASX before deciding whether to apply for New Shares. In particular, you should consider the risk factors outlined in Section 6 and consider these factors in light of your personal circumstances, including financial and taxation issues. The information provided in this Offer Booklet is not financial product advice and has been prepared without taking into account your investment objectives,

financial circumstances or particular needs. Comet Ridge is not licensed to provide financial product advice in respect of the New Shares. You should conduct your own independent review, investigation and analysis of the New Shares the subject of the Offer. If you are in any doubt as to how to deal with this Offer or have any questions, you should contact your professional adviser without delay. You should obtain any professional advice you require to evaluate the merits and risks of an investment in Comet Ridge before making any investment decision based on your investment objectives.

Overseas Shareholders

This Offer Booklet does not, and is not intended to, constitute an offer, invitation or issue in any place in which, or to any person to whom, it would be unlawful to make such an offer, invitation or issue. This Offer Booklet has not been, nor will it be, lodged, filed or registered with any regulatory authority under the securities laws of any country. In particular, the New Shares have not been and will not be, registered under the US Securities Act and may not be offered, sold or delivered within the US or to or for the account or benefit of any US Person, except pursuant to applicable exceptions from registration. In addition, hedging transactions with respect to the New Shares may not be conducted unless in accordance with the US Securities Act.

Where it is not practical for the Company having regard to the number of overseas Shareholders, the number and value of the New Shares such shareholders would be offered and the costs of compliance and the regulatory requirements of the relevant overseas jurisdiction, the Company has not

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made offers to Shareholders in that overseas jurisdiction.

Accordingly, subject to certain exceptions, Entitlement and Acceptance Forms will not be sent to all Shareholders outside of Australia or New Zealand. The distribution of this Offer Booklet and the accompanying Entitlement and Acceptance Form outside of Australia or New Zealand may be restricted by law and persons who come into possession of this Offer Booklet and the accompanying Entitlement and Acceptance Form should seek advice on and observe those restrictions. Any failure to comply with those restrictions may constitute a violation of applicable securities laws.

No Entitlement trading

Entitlements are non-renounceable and will not be tradable on the ASX or otherwise transferable. Accordingly, you can not, in most circumstances, withdraw your application for New Shares once it has been accepted.

Underwriting/sub-underwriting

The Offer is underwritten by Wilson HTM. Wilson HTM has entered into separate subunderwriting agreements with a number of parties including each of Waterford Pacific Pty Ltd atf The McKay Family Trust, Pieters Capital Pty Ltd atf The Pieters Investment Trust, Gilby Resources Pty Ltd atf The Gilby Investment Trust, and SAAD.

Future performance

The pro forma financial information (including past performance information) provided in this Offer Booklet is for information purposes only and is not a forecast or projection of operating results to be expected in any future period. Except as required by law, and only then to the extent so required, neither Comet Ridge nor any other person warrants or guarantees the future performance of Comet Ridge or any return on any investment made pursuant to this Offer Booklet.

Financial forecasts and other forward looking statements

Some of the statements appearing in this Offer Booklet may be in the nature of forward looking statements, including statements of current intention, statements of opinion and predictions as to possible future events. You should be aware that such statements are not statements of fact and there can be no certainty of outcome in relation to the matters to which the statements relate. Forward looking statements are subject to many inherent risks and uncertainties before actual outcomes are achieved. Actual outcomes may differ materially from the events, intentions or results expressed or implied in any forward looking statement in this Offer Booklet. None of Comet Ridge or persons named in this Offer Booklet or any person involved in the preparation of this Offer Booklet makes any representation or warranty (express or implied) as to the accuracy or likelihood of fulfilment of any forward looking statement, or any intentions or outcomes expressed or implied in any forward looking statement. You are cautioned not to place undue reliance on any forward looking statement having regard to the fact that the outcome may not be achieved.

No representations other than as set out in

this Offer Booklet

No person is authorised to give any information or make any representation in connection with the Offer other than as contained in this Offer Booklet. Any information or representation in connection with the Offer not contained in this Offer Booklet is not, and may not be relied upon as having been authorised by the Company or any of its officers.

Defined terms

Defined terms and abbreviations used in this Offer Booklet are explained in Section 8.

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1. Ke Offer Information y

Summary Offer Information

Issue Price per New Share	A$0.27 per New Share payable in full on application
Shareholder entitlements	1 New Share for every 5 Shares beneficially held on the Record Date
Discount of the Issue Price to the closing price of A$0.45 on Wednesday 13 May 2009	40.0%
Discount of the Issue Price to the theoretical ex- entitlements price of A$0.41 using the closing price	34.5%
Discount of the Issue Price to the 5 day volume weighted average price of A$0.45	39.3%
Number of New Shares to be issued under the Offer1.	51.2 million New Shares
Amount which may be raised under the Offer1	A$13.8 million
Maximum number of Shares on issue following the Offer1. 2.	307.4 million Shares

Excludes 32,867,500 vested options that may be exercised prior to the Record Date and any New Shares subscribed for under the Offer following such exercise.
Includes Placement Shares to be issued under the recent placement to sophisticated investors announced on 18 May 2009.

Indicative Timetable

Announcement of the Offer – Offer Booklet, Appendix 3B and 708AA Cleansing Notice lodged with ASX	18 May 2009
Shares trade ‘ex-Entitlement’ (date from which Shares commence trading without the entitlement to participate in the Offer)	21 May 2009
Record Date to determine Entitlements	27 May 2009
Anticipated despatch of Offer Booklet and Entitlement and Acceptance Forms	29 May 2009
Offer Opening Date	29 May 2009
Offer Closing Date and last day for lodgement of Entitlement and Acceptance Forms and payment in full	18 June 2009
Allotment and expected date for despatch of holding statements	26 June 2009
Expected date for commencement of trading of New Shares on the ASX	29 June 2009

These dates are indicative only and may be subject to change. Subject to the Corporations Act, the Listing Rules and other applicable laws, the Directors in conjunction with the Lead Manager and Underwriter, reserve the right to vary the dates of the Offer. The Directors also reserve the right not to proceed with the whole or part of the Offer.

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2. Chairman’s Letter

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18 May 2009

Dear Shareholder,

It is my pleasure to introduce this Offer Booklet and invite you to participate in the continued growth of your Company by taking up your Entitlement to New Shares in Comet Ridge.

Recently, your Company completed a placement of ordinary shares at A$0.34 per Share to institutional and sophisticated investors to raise approximately A$7.5 million. The Directors now wish to provide the opportunity for Eligible Shareholders to invest in New Shares under an entitlement offer. The Offer is a non-renounceable entitlement offer of 1 New Share at A$0.27 per New Share for every 5 Shares held at the Record Date, to raise approximately A$13.8 million.

As the Entitlements being offered are non-renounceable, your Entitlements to subscribe for New Shares under this Offer Booklet are not transferable and there will be no trading of Entitlements. For details of how you can deal with your Entitlements, please refer to Section 4 of this Offer Booklet.

On 16 April 2009, your Company entered a new phase of growth following the approval of the merger between Chartwell Energy and Comet Ridge. I believe the decision by Comet Ridge Shareholders to vote strongly in favour of the merger marks a new and exciting phase for the Company. The combination of the executive and non-executive team now in place along with the Company’s asset base creates a strong platform on which to grow shareholder value.

The funds raised under this Offer and the placement will be used to materially advance exploration programs in key coal seam gas (CSG) projects in Australia and New Zealand. The assets of the Company offer shareholders substantial upside value potential and with these funds, the Company is well placed to realise this potential.

In these volatile times the board considers it prudent to have the Offer underwritten. This will be undertaken by Wilson HTM. In pricing the Offer your board has endeavoured to set a price which will encourage strong support from existing shareholders.

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Some Directors (James McKay and Chris Pieters) together with Tony Gilby (a proposed Director) are supporting the Offer by participating as sub-underwriters. The key rationale of the merger with Chartwell Energy was to provide Comet Ridge with additional technical and financial strength and this support should give Shareholders confidence that the Board believes in the potential of the Company. Additionally some Directors intend to subscribe for their full Entitlements totalling approximately A$1.25 million as an indication of their further support for the Offer.

Information about the Offer and the key risks of investing in the Company are set out in this Offer Booklet. I encourage you to read it in its entirety before making your investment decision.

On behalf of the Board I encourage you to take up this Offer and look forward to you continuing your investment in the Company.

Yours faithfully

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Jeff Schneider

Non-Executive Chairman

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3. Details of the Offer

The Offer

The Company is making an Offer of New Shares to Eligible Shareholders on the basis of 1 New Share for every 5 Shares held on the Record Date. The Issue Price for each New Share is A$0.27 which is payable in full on application. Fractional entitlements are being rounded up to the next whole New Share.

The number of New Shares that you are entitled to subscribe for is shown on the accompanying Entitlement and Acceptance Form. The Closing Date for receipt of Entitlement and Acceptance Forms and payment of Application Monies is 5:00 pm WST on Thursday, 18 June 2009 or such other date as the Directors may determine, subject to the requirements of the Listing Rules and other applicable law. There is no minimum subscription.

The number of New Shares which may be issued under the Offer will be 51,225,190[1.] . The number of New Shares issued will result in gross proceeds of approximately A$13.8 million. The cost of the Offer is set out in Section 5.

No Entitlements Trading

The Offer is non-renounceable. This means that your Entitlement to subscribe for New Shares under this Offer Booklet is not transferable and there will be no trading of Entitlements on ASX. Any Entitlements not taken up by an Eligible Shareholder will lapse and will revert to the Underwriter and sub-underwriters.

Closing Date

The Company will accept Entitlement and Acceptance Forms and payment of Application Monies until 5:00 pm WST on Thursday, 18 June 2009 or such other date as the Directors may determine, subject to the requirements of the Listing Rules and other applicable law.

Underwriting/Sub-Underwriting

The Offer is underwritten by Wilson HTM. The Underwriter has entered into individual sub-underwriting arrangements with a number of sub-underwriters including Waterford Pacific Pty Ltd atf The McKay Family Trust (being an entity in which James McKay (Director) has an interest), Gilby Resources Pty Ltd atf The Gilby Investment Trust (being an entity in which Tony Gilby (a proposed Director) has an interest), Pieters Capital Pty Ltd atf The Pieters Investment Trust (being an entity in which Chris Pieters (Director) has an interest) and SAAD Investment Company Limited (SAAD) Details of the Underwriting Agreement and sub-underwriting referred to above are set out in Section 7 of this Offer Booklet.

1 This excludes any New Shares subscribed for under the Offer following the exercise of any Options before the Record Date

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Issue of New Shares

The Company expects to issue the New Shares on Friday, 26 June 2009.

Ranking of New Shares

All New Shares being offered will, on issue, rank equally in all respects with all other Shares on issue. The Company will apply for quotation of the New Shares to be traded on the ASX.

CHESS

The Company participates in the Clearing House Electronic Subregister System, known as CHESS. ASX Settlement and Transfer Corporation Pty Ltd ACN 008 504 532 (ASTC), a wholly owned subsidiary of ASX, operates CHESS in accordance with the Listing Rules and ASTC Settlement Rules.

Under CHESS, Applicants will not receive a certificate but will receive a statement of their holding of New Shares.

If you are registered in the Issuer Sponsored Subregister, your statement will be despatched by Computershare Investor Services Pty Limited and will contain the number of New Shares issued to you under this Offer Booklet and your security holder reference number.

A CHESS statement or Issuer Sponsored statement will routinely be sent to Shareholders at the end of any calendar month during which the balance of their holding changes. Shareholders may request a statement at any other time; however, there may be a charge associated with the provision of this service.

Market prices of Shares

The lowest and highest market sale prices of Shares on the ASX during the three months preceding the date of this Offer Booklet, were A$0.20 and A$0.50 respectively. The closing price of the Company’s Shares on the ASX, on 13 May 2009 (being the last day of trading prior to the announcement of the placement and Offer) was A$0.45. The Issue Price of A$0.27 represents a discount of approximately 40% to the closing price on 13 May 2009, a 34.5% discount to the theoretical ex-entitlements price on that date and a 39.3% to the five day volume weighted average price of the Company’s Shares traded on the ASX over the five days up to 13 May 2009.

Overseas Shareholders

Restrictions regarding the Offer and certain overseas jurisdictions are set out in the Important Information section of this Offer Booklet. Return of a duly completed Entitlement and Acceptance Form will be taken by the Company to constitute a representation that there has been no breach of laws in connection with your ability to participate in the Offer. The Company reserves the right to treat as invalid any Entitlement and Acceptance Form or application by the payment of funds which does not comply with the requirements of the Offer Booklet or the Entitlement and Acceptance

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Form or which the Company believes as been sent for or on the account of a person not entitled to participate in the Offer.

Taxation

Shareholders should be aware that there may be taxation implications associated with participating in the Offer. The taxation consequences of participating in the Offer may vary depending on the individual circumstances of the Shareholder. Shareholders should consult their own professional taxation advisers to obtain advice in relation to the taxation laws and regulations applicable to their personal circumstances.

Risks

An investment in Comet Ridge involves a number of risks. The risks associated with an investment in Comet Ridge are set out throughout this Offer Booklet and, in particular, in Section 6 of this Offer Booklet and you should consider these factors in light of your personal circumstances, including financial and taxation issues. Before making an investment decision, potential Applicants should read the Offer Booklet in full and should consult with their professional advisers. You should conduct your own independent review, investigation and analysis of the Comet Ridge shares the subject of the Offer. You should obtain any professional advice you require to evaluate the merits and risks of an investment in Comet Ridge before making any investment decision based on your investment objectives.

Questions

If you have any questions in relation to the Offer, please consult your professional adviser.

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4. What Eligible Shareholders May Do

This section relates to Eligible Shareholders.

Your Entitlement to New Shares is shown on the accompanying Entitlement and Acceptance Form. Before taking any action in relation to the Offer, you should read this Offer Booklet in its entirety, and seek professional advice from your professional adviser.

You may:

take up all of your Entitlement to New Shares;
take up part of your Entitlement to New Shares and allow the balance to lapse; or
do nothing and allow all of your Entitlement to New Shares to lapse.

If you wish to take up all of your Entitlement to New Shares

If you wish to take up your Entitlement to New Shares, you should complete the accompanying Entitlement and Acceptance Form in accordance with the instructions set out in the Entitlement and Acceptance Form and send the completed Entitlement and Acceptance Form together with your cheque for the applicable Application Monies to the Share Registry at the address set out on the Entitlement and Acceptance Form. Completed Entitlement and Acceptance Forms must reach the Share Registry by no later than 5:00 pm WST on the Closing Date of Thursday, 18 June 2009.

As an alternative you may pay Application Monies by BPAY[] and those Application Monies must reach the Share Registry by no later than 5:00 pm WST on the Closing Date of Thursday, 18 June 2009.

Please note that should you choose to use BPAY[] to pay for your Application Monies:

you do not need to submit the personalised Entitlement and Acceptance Form but are taken to make the declarations on that Form; and
if you do not pay for your full Entitlement, you are deemed to have taken up your Entitlement in respect of such whole number of New Shares which is covered in full by your Application Monies.

If you wish to take up part of your Entitlement to New Shares and allow the balance to lapse

If you wish to take up part of your Entitlement to New Shares and allow the balance to lapse, complete the Entitlement and Acceptance Form in accordance with the instructions set out in the Entitlement and Acceptance Form for those Entitlements you wish to accept. The completed Entitlement and Acceptance Form should be sent together with your cheque for the applicable Application Monies to the Share Registry at the address set on the Entitlement and Acceptance Form by no later than 5:00 pm WST on the Closing Date of Thursday, 18 June 2009.

 Registered to BPAY Pty Ltd (ABN 69 079 137 518)

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As an alternative you may pay Application Monies by BPAY[] and those Application Monies must reach the Share Registry by no later than 5:00 pm WST on the Closing Date of Thursday, 18 June 2009.

Please note that should you choose to use BPAY[] to pay for your Application Monies: • you do not need to submit the personalised Entitlement and Acceptance Form but are taken to make the declarations on that Form; and
if you do not pay for your full Entitlement, you are deemed to have taken up your Entitlement in respect of such whole number of New Shares which is covered in full by your Application Monies.

Entitlement to New Shares not taken up

If you decide not to take up all or part of your Entitlement to New Shares, do not take any further action and the Entitlement will lapse. You will receive no payment for your lapsed Entitlements. You cannot sell or transfer your Entitlements to another person. Your holding of existing Shares will, however, be diluted because the issue of New Shares will increase the total number of Shares on issue.

Entitlement and Acceptance Form is binding

Receipt of payment of Application Monies whether by BPAY[] or cheque and a completed and lodged Entitlement and Acceptance Form constitutes a binding offer to acquire New Shares on the terms and conditions set out in this Offer Booklet and an acknowledgement by you that you have received and read this Offer Booklet; you have acted in accordance with the terms of the Offer detailed in this Offer Booklet; and that you agree to all of the terms and conditions as detailed in this Offer Booklet. The Entitlement and Acceptance Form once lodged cannot be withdrawn. The Entitlement and Acceptance Form does not need to be signed to be binding. If the Entitlement and Acceptance Form is not completed correctly, the Company in its absolute discretion can reject it or treat it as valid. The Company’s decision as to whether to accept or reject an Entitlement and Acceptance Form or how to interpret an incorrectly completed Entitlement and Acceptance Form is final.

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5. Company Overview and Effects of the Offer

Overview

Comet Ridge is a Brisbane based Coal Seam Gas (CSG) exploration and development company with a focus on key projects in Queensland and New Zealand. The Company also has exposure to prospective oil and gas fields via an investment in a joint venture company based in the United States.

On 9 February 2009, the Directors of Comet Ridge and Chartwell Energy announced the proposed merger of the two companies. The merger was approved at a shareholder meeting on 16 April 2009. By merging with Chartwell Energy, Comet Ridge has gained access to the technical experience of the Chartwell Energy directors and management, a number of whom were key employees or directors of Sunshine Gas Limited, as well as an interest in various prospective New Zealand CSG assets and cash.

Summary of Operations

Key Projects

Galilee Basin

Comet Ridge has two 100% owned interests in ATP 743 and ATP 744 spanning approximately 13,000 square kilometres in the Galilee Basin, Queensland. The Galilee Basin is approximately 500km west of Gladstone and contains large quantities of highly volatile, low rank thermal coal. Recently, the basin has gained considerable interest as it is seen to have the potential as a major gas producing region. Both of these permits are considered prospective for CSG with extensive coals known to be present throughout the permits. There is extensive coal exploration data set on the eastern side of the Basin from the 1970’s and 1980’s, and there has been renewed coal exploration activity in recent years. There have been some conventional and CSG exploration wells drilled in the Galilee Basin by a variety of companies.

The most prospective coals in this part of the Galilee Basin are within the Late Permian Betts Creek Beds which are equivalent to the Bandanna Formation. Coals within the Bandanna Formation are the producing horizons in the Fairview and Spring Gully CSG fields in the Bowen Basin. The Early Permian Aramac Coal Measures are also possible targets on the Western side of the Comet Ridge permits.

The exploration program for the blocks consists of eight coreholes in 2009/10 to determine gas content and saturation in the region. If successful this would be followed by a pilot program in 2010. Success would be followed by further appraisal wells and pilot testing. Adequate gas reserves must be confirmed to justify the development of infrastructure in the Galilee Basin either from these permits, and/or from activity in adjacent permits.

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Mahalo Project – Bowen Basin

The Mahalo Block is located in the Bowen Basin, approximately 150km north of the producing Fairview CSG field. Santos Limited has a 30% working interest and is the Operator of the Block. Australia Pacific LNG Limited (a joint venture between Origin Limited and ConocoPhillips) has a 30% working interest and Comet Ridge has a 40% working interest in the block.

Santos Limited has proposed a A$3.24m exploration program for 2009 which commences with the drilling and testing of one core-hole (Scrubber Gully-1, in the Sunlight Area). The joint venture is still finalising the details of the 2009 work program. If successful, development could commence in late 2010 or early 2011. The Company considers the permit to have good CSG prospectivity in an area with gas transmission infrastructure in place and is keen to support an accelerated work program.

Greymouth – New Zealand

Mining Permit PMP50100 (Greymouth) in the West Coast coal region of New Zealand’s South Island was awarded to Macdonald Investments Ltd (MIL) in July 2007 and covers 170km². By way of a two-stage farmin process Comet Ridge (through its merger with Chartwell Energy) is earning a 50% interest in PMP50100.

Stage 1 has been completed earning Comet Ridge a 20% interest and operatorship. This program consisted of seismic acquisition and drilling two core holes. Stage 2 (spend of NZ$6.2m) is underway and involves further seismic (already completed), two additional core holes and a three well production pilot scheme. This phase will take Comet Ridge’s interest to 50% with an option to increase to 60%.

Secondary Projects

Gunnedah Basin

Comet Ridge’s interest in the Gunnedah Basin permits comprises PEL427 covering 7,014km² and PEL428 covering 6,025km². Eastern Star Gas Limited, as operator of both permits drilled two CSG exploration wells in 1Q 2009, one in each permit, to fulfil its farm-in obligations. The first well, Moree-4 in PEL 427 encountered approximately five metres of net coal. The second well, Kurrabooma-1 in PEL 428 encountered approximately four metres of net coal. The permit areas are large and north of the Eastern Star Gas Narrabri CSG Production area. Comet Ridge has these tenements in good standing and will evaluate drilling results from surrounding tenements before undertaking future work programs.

Buller Block – New Zealand

PEP50279 (Buller Block) was granted in April 2008 for a period of five years to a joint venture between Chartwell Energy (60%) and MIL (40%). The permit covers an area of 8,722km² over much of the onshore Westland Basin.

The Painkiller Creek-1C exploration core well was drilled in March 2009, near Reefton in the West Coast region of the South Island. The well was designed to assess the development of the Eocene age Brunner coal measures. The core well found a lack of

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coal development but fulfilled Year 1 exploration commitments on the permits. Further exploration will be undertaken in 2010 following the completion of further studies incorporating these results.

North Waikato Block – New Zealand

PEP50280 (North Waikato Block) was also granted for a period of five years to Chartwell Energy (60%) and MIL (40%). It covers an area of 3,667km² over much of the North Waikato coalfields and the Hauraki Gulf for the purposes of exploring for CSG. The location of PEP50280 is close to the major population centres of New Zealand’s North Island and adds to the block’s appeal. Power and pipeline infrastructure exist in the Western part of the permit. Solid Energy’s Huntly CSG pilot project lies to the South and the large Huntly gas-fired power station is nearby.

In February 2009 the Matata-1C exploration well was drilled to a total depth of 472 metres and encountered a thicker than expected sedimentary sequence, however with poor coal development. The well was plugged and abandoned. Matata-1C was the first exploration well drilled by Chartwell Energy in PEP50280.

United States

In 2008, Comet Ridge completed a deal with Pine Brook Road LLC (Pine Brook) to joint venture its US assets into a new company, Comet Ridge Resources LLC. Pine Brook is a New York based private equity firm that operates in the energy and financial services sectors.

As part of the deal, Pine Brook provided a line of equity of US$100m and invested cash of US$7m plus US$2m in assets in return for an initial 56.25% interest into the venture. Pine Brook has the opportunity to increase its interest in the venture to 80% after which Comet Ridge has the right to fund its 20% interest or be diluted down to a minimum of 5% interest.

Recent drilling and appraisal activity has focused in the Florence Oil Field (Colorado), and Grays Harbor Basin (Pacific Northwest). Currently the Florence Oil Field produces approximately 130 BOPD from three wells. Additional drilling is being planned over the next 6 to 12 months.

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Use of Funds

The primary purpose of funds raised under the placement and this Offer is to advance key projects in the Galilee Basin and Mahalo Project in Queensland and to fund a core well and pilot program in the Greymouth project in New Zealand. Money raised will satisfy funding requirements over the next 12 to 18 months. A use of funds table is provided below.

Use of Funds	Amount (A$m)
Key Projects:
Galilee (QLD)	6.5
Mahalo (QLD)	2.2
Greymouth (NZ)	5.1
Secondary Projects	4.5
Working Capital	2.0
Offer Costs	1.0
Total	21.3

At the completion of the work program described above, Comet Ridge expects to have a cash balance of approximately A$6.7m which will be applied to further exploration and appraisal activities, the scope of which will be determined from the results of the current activities.

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Directors

The following persons are Directors of the Company as at the date of this Offer Booklet:

Jeff Schneider Non-Executive Chairman

Jeff Schneider joined the Comet Ridge Board and was elected Chairman on 28 August 2003. He has over 30 years experience in the oil and gas industry, including 23 years with Woodside Petroleum Limited. His roles at Woodside included General Manager Commercial, accountable for business and strategic planning, mergers and acquisitions, as well as business performance of Woodside’s North West Shelf investment. In this position he was also responsible for marketing of all the company’s products including natural gas, LNG, condensate and oil. Other roles within Woodside included Director of Australian Gas where he was responsible for the commercialisation of reserves in the Otway Basin, Timor Sea and Browse Basin. He holds a Bachelor of Commerce degree from UWA.

Jeff resigned from Woodside in 2002 to pursue other business interests. He is also Chairman of Strike Oil Limited.

Tor McCaul Managing Director

Tor McCaul graduated with honours in Petroleum Engineering from UNSW in 1987 and spent the next 9 years based in Brisbane working for operating companies in technical roles on projects in Queensland, New Zealand and Papua New Guinea. He spent the following 11 years in Asia (Karachi, Jakarta, Chennai and Delhi) working for British independent companies in technical, finance, commercial and management roles which included 4 years on the 23 million ton per annum Bontang LNG projects in Indonesia, the world’s largest, providing LNG into Japan, South Korea and Taiwan. In 2008 he jointed Chartwell Energy in Brisbane as CEO and has subsequently been appointed Managing Director of Comet Ridge following the merger. He also holds a Bachelor of Economics degree from UQ and a MBA from Edinburgh Business School.

He is a member of the Society of Petroleum Engineers, having served in several positions, including Chairman, on the executive committee for Queensland Section over several years. He is also a past member of the UNSW Centre for Petroleum Engineering Advisory Committee.

Gillian Swaby Non-Executive Director

Gillian Swaby has over 26 years experience in the Australian resources industry. She specialises in the areas of corporate secretarial practice, corporate law, accounting, financial management, and control. Gillian is the principal of a corporate consulting company and past Chair of the West Australia Council of Chartered Secretaries of Australia and a former Director on their National Board. Gillian holds a Bachelor of Business (Accounting) degree from Edith Cowan University and is a Fellow of the Australian Institute of Company Directors and Chartered Institute of Secretaries.

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James McKay Non-Executive Director

James McKay has a strong commercial background, with finance, business management and legal expertise. He holds both Bachelor of Commerce and Bachelor of Laws degrees from UQ and has been involved in the establishment and development of a number of businesses. James was previously Chairman of Sunshine Gas Limited, before its takeover by Queensland Gas Company in 2008.

James is a shareholder and director of a privately-owned funeral services group with interests in two cemeteries and crematoria. He is a past president of the Australasian Cemeteries and Crematoria Association, having served on its board for over 8 years.

Chris Pieters

Non-Executive Director

Chris Pieters is Managing Director and co-founder of Walcot Capital, a private venture capital business specialising in energy investment. Prior to that he was Chief Commercial Officer of Sunshine Gas Limited where he was a key member of the team that built the company before its takeover by Queensland Gas Company in 2008. Chris also held other technical and business development roles whilst at Sunshine Gas Limited.

Chris holds both Bachelor of Science (Geology) and Bachelor of Business degrees from UQ, and an Honours degree in Petroleum Geology and Geophysics from the Australian School of Petroleum in Adelaide. Chris is a member of the Petroleum Exploration Society of Australia.

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Unaudited Pro-forma Balance Sheet

The unaudited pro-forma balance sheet of the Company as at 31 March 2009 is set out below. The pro-forma balance sheet is presented to show the impact of the Entitlement Offer and recent placement (less applicable Offer costs) on the balance sheet of the Company and has been extracted from financial statements prepared by management.

On 16 April 2009, Comet Ridge and Chartwell Energy Limited completed the merger of the two companies. The pro-forma balance sheet also adjusts for the impact of the merger.

A$	Unaudited Post-Merger 31 Mar 2009	Pro-forma Adjustment	Unaudited Pro-forma 31 Mar 2009
CURRENT ASSETS
Cash and cash equivalents	7,248,060	20,310,801	27,558,861
Trade and other receivables	720,138	-	720,138
Inventory	192,721	-	192,721
Other financial assets	856,192	-	856,192
TOTAL CURRENT ASSETS	9,017,111	20,310,801	29,327,912
NON-CURRENT ASSETS
Investments accounted for using the equitymethod	8,925,852	-	8,925,852
Property, plant and equipment	38,454	-	38,454
Exploration and evaluation expenditure	1,908,743	-	1,908,743
TOTAL NON-CURRENT ASSETS	10,873,050	-	10,873,050
TOTAL ASSETS	19,890,161	20,310,801	40,200,962
CURRENT LIABILITIES
Trade and other payables	931,779	-	931,779
TOTAL CURRENT LIABILITIES	931,779	-	931,779
TOTAL LIABILITIES	931,779	-	931,779
NET ASSETS	18,958,382	20,310,801	39,269,183
EQUITY
Issued capital	21,121,745	20,310,801	41,432,546
Reserves	3,316	-	3,316
Accumulated losses	(2,166,679)	-	(2,166,679)
TOTAL EQUITY	18,958,382	20,310,801	39,269,183

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Directors’ intentions

Some Directors intend to subscribe for their full Entitlements totalling approximately A$1.25 million as an indication of their further support for the Offer.

Expenses of the Offer

All expenses connected with the Offer are being borne by the Company. Total expenses of the Offer are estimated to be in the order of A$1m.

Control and capital structure

The following table shows the proposed capital structure of the Company on completion of the Offer. The exact number of New Shares to be issued may vary and will be dependant on whether any Options are exercised prior to the Record Date.

Shares	Number
Existing Shares on issue at the date of this announcement	234,125,952
New Placement Shares to be issued	22,000,000
Shares on issue after the Placement Shares are issued	256,125,952
Estimated number of New Shares to be issued under the Offer1	51,225,190
Estimated total Shares on issue after the Offer1	307,351,142

Existing options to acquire shares on issue at the date of this announcement2	32,867,500

~~1~~ Assumes that no Options are exercised prior to the Record Date

2 The Options on issue are not quoted, and their terms do not provide for participation in pro rata issues. As at the date of this announcement a letter had been circulated to all Option holders providing notice of the Offer.

Citicorp Nominees (which holds Shares for the benefit of AWAL Bank BSC) as at the date of this Offer Booklet holds 51,500,000 Shares and SAAD (an associate of AWAL Bank BSC) has subscribed for 2,050,000 Placement Shares as part of the placement (being in aggregate 20.9% of the voting power of the Company and in aggregate 18.5% of the voting power of the Company on a fully diluted basis*).

Where Shareholders do not participate in the Offer, then in respect of any shortfall under the Offer, SAAD under its sub-underwriting agreement with Wilson HTM has separately committed to subscribe (as may be required by the Underwriter) for up to a maximum $2,781,000 (being 10,300,000 New Shares under the Offer at the Issue Price) less the amount of any New Shares multiplied by the Issue Price, that are issued to Citicorp Nominees under the Entitlement Offer.

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If Citicorp Nominees (on behalf of AWAL Bank BSC) takes up their respective full entitlement under the Offer and SAAD subscribes for the maximum number of New Shares allowable under its sub-underwriting agreement, Citicorp Nominees and SAAD will in aggregate hold 64,260,000 Shares (being in aggregate 20.9% of the voting power of the Company and in aggregate 18.9% of the voting power of the Company on a fully diluted basis*).

To the extent that a Shareholder does not participate in the Offer, the interest of that Shareholder will be diluted.

This indicates the corresponding voting power following the issue of the Placement Shares.
** This indicates the corresponding voting power following the issue of the Placement Shares and the issue of Shares if the 32,867,500 Options on issue were exercised and the corresponding Shares were issued.

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6. Risk Factors

Introduction

Activities of Comet Ridge, as in any business, are subject to risks which may impact on its future performance. The future performance of Comet Ridge and the future investment performance of the New Shares may be influenced by a range of factors. Many are outside the control of the Board and the Company. Prior to making any decision to accept the Offer, investors should carefully consider the following risk factors applicable to the Company.

Careful consideration should be given to the following risk factors, as well as the other information contained in this Offer Booklet and the Eligible Shareholders own knowledge and enquiries, before an investment decision is made. Some of the risks may be mitigated by the Company using safeguards and appropriate systems and taking certain actions. Some of the risks may be outside the control of Comet Ridge and not capable of mitigation. There are also general risks associated with any investment in shares.

The risks listed should not be taken as exhaustive of the risks faced by Comet Ridge. Factors other than those listed may in the future materially affect the financial performance of Comet Ridge and the value of the New Shares offered under this Offer Booklet. Investors should read this Offer Booklet in its entirety and consult their professional advisers before deciding whether to accept the Offer for New Shares

Risks Specific to an Investment in Comet Ridge

Eligible Shareholders should be aware of risks specific to an investment in the Company, which may include, but are not limited to those risks described below:

a) Volatility of oil and gas prices and markets

The Company’s financial condition, operating results and future growth are dependant on the prevailing prices for oil and natural gas production. Historically, the markets for oil and natural gas have been volatile and such markets are likely to continue to be volatile in the future. Prices for oil and natural gas are subject to large fluctuations in response to relatively minor changes to the demand for oil and natural gas, whether the result of uncertainty or a variety of additional factors beyond the control of the Company. Any substantial decline in the prices of oil and natural gas could have a material adverse effect on the Company.

b) Native Title

Native title in Australia is governed by the Native Title Act 1993 (Cth) ( NTA ) and by complementary state legislation. The NTA provides a regime that enables persons claiming to hold native title to lodge a claim to that effect for determination.

The effect on each tenement will depend on the nature of the tenement, the date of its grant or proposed grant, and the nature of the underlying land tenures.

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The effect of the NTA is that existing and new tenements held by the Company may be affected by native title claims and procedures. There is a potential risk that a determination could be made that native title exists in relation to land the subject of a tenement held by the Company which may affect the operation of the Company’s business and development activities. The involvement in the administration and determination of native title issues may have a material adverse impact on the position of the Company in terms of cash flows, financial performance, business development, ability to pay dividends and the share price.

c) Exploration and Production

The oil and gas permits which the Company has an interest in are at various stages of exploration and potential investors should understand that oil and gas exploration and development are high risk undertakings. There can be no assurance that exploration of the project areas described in this Offer Booklet, or any other permits that the Company may acquire an interest in, will result in the discovery of an economic hydrocarbon reservoir. Even if an apparently viable reservoir is identified, there is no guarantee that it can be commercially exploited. Further, some of the permits are largely unexplored and have only a very limited history and there is no certainty that the proposed exploration will encounter any hydrocarbons that will ultimately be commercially viable.

The business of commodity development and production involves a degree of risk. Amongst other factors, success is dependent on successful design, construction and operation of efficient gathering, processing and transportation facilities. Even if the Company recovers potentially commercial quantities of gas, there is no guarantee that the Company will be able to successfully transport the gas to commercially viable markets or sell the gas to customers to achieve a commercial return.

d) General Project Risks

There can be no assurance that the Company’s planned development projects and exploration and appraisal activities will be successful. The drilling of oil and gas wells involves a high degree of risk, especially the risk of a dry hole or of a well that is not sufficiently productive to provide economic return of the capital expended to drill the well. There are also delays and other risks associated with the Company’s reliance on third parties during the conduct of exploration and development activities.

e) Operating Risks

Industry operating risks include fire, explosions, blow outs, pipe failures, abnormally pressured formations and environmental hazards such as accidental spills or leakage of petroleum liquids, gas leaks, ruptures, discharge of toxic gases, premature declines in reservoirs, uncontrollable flows of oil, natural gas or well fluids, remoteness of properties and adverse weather conditions. The occurrence of any of these risks could result in substantial losses to the Company due to injury or loss of life, damage to or destruction of property, natural resources or equipment, pollution or other environmental damage, cleanup

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responsibilities, regulatory investigation and penalties or suspension of operations. Damages occurring to third parties as a result of such risks may give rise to claims against the Company.

f) Joint Venture or Farmin Risks

The Company is a party to joint venture operating agreements or farmin agreements for prospects in which it will earn minority interests of 50% or less. Under these agreements, the Company may be voted into programs and budgets which it does not agree with or have the cash resources to fund. It may also be required to contribute to any increases in capital expenditure requirements and/or operating costs. Further, if any of the Company’s joint venture partners fail to or are unable to fund their pro rata contributions to expenditure, the Company may have to make increased contributions to ensure that the program succeeds. It may also be the case that delays in programs may arise due to the joint venture partners not reaching agreement on joint venture decisions.

g) Commercialisation

Even if the Company recovers potentially commercial quantities of oil or gas, there is no guarantee that the Company will be able to successfully transport the oil or gas to commercially viable markets or sell the oil or gas to customers to achieve a commercial return.

h) Environmental Regulation and Risks

The Company’s operations and projects are subject to State and Federal laws and regulation regarding environmental hazards. These laws and regulations set various standards regulating certain aspects of health and environmental quality and provide for penalties and other liabilities for the violation of such standards and establish, in certain circumstances, obligations to rehabilitate current and former facilities and locations where operations are or were conducted.

The Company proposes to minimise these risks by conducting its activities in an environmentally responsible manner, in accordance with applicable laws and regulations and where possible, by carrying appropriate insurance coverage. There is also a risk that the environmental laws and regulations may become more onerous, making the Company’s operations more expensive.

i) Legislative Change

Changes in government regulations and policies may adversely affect the financial performance or the current and proposed operations generally of the Company. From 1 January 2009, The Environmental Protection Regulation 2008 has replaced the Environmental Protection Regulation 1998. Under the new regulation, a number of significant changes have occurred, including re-defining Environmentally Relevant Activities that impact permits to be issued and renewed. In addition, the Queensland Government water policy was announced in October 2008. These changes may increase operating costs and may have a material adverse effect on the Company. The Company is not aware of any other current or proposed material changes in relevant regulations or policy.

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j) Reserves Risk

There are numerous uncertainties inherent in estimating quantities of proven and measured reserves, including many factors beyond the control of the Company and its Directors. Any reserve data in this Offer Booklet represents estimates only. In general, estimates of economically recoverable oil and natural gas reserves are based upon a number of variable factors and assumptions, such as comparisons with production from other producing areas, the assumed effects of regulation by governmental agencies, assumptions regarding future oil and natural gas prices and future operating costs, all of which may vary considerably from actual results. All such estimates are, to some degree speculative, and classifications of reserves are only attempts to define the degree of speculation involved. For these reasons, estimates of economically recoverable oil and natural gas reserves attributable to any particular group of properties and classification of such reserves based on risk of recovery and other factors may vary substantially. Actual production with respect to reserves may vary from such estimates and such variances could be material.

Further, the future success of the Company will depend on its ability to find or acquire oil and gas reserves that are economically recoverable. There can be no assurance that the Company’s planned development projects and exploration activities will result in significant reserves or that it will have success drilling productive wells. Reserve and resource estimates are estimates only and no assurance can be given that any particular level of recovery from hydrocarbon reserves will in fact be realised or that an identified hydrocarbon resource will ever qualify as commercially viable which can be legally and economically exploited. The drilling of oil and gas wells involves a high degree of risk, especially the risk of a dry hole or of a well that is not sufficiently productive to provide economic return of the capital expended to drill the well.

k) Additional Funding Requirements

The Company is likely to require access to further funding in the future. If, for any reason, access to that capital is not available, the Company may be adversely affected in a material way. There can be no assurance that additional funds will be available. If the Company raises additional funds through the issue of equity securities, this might result in dilution to the existing shareholders.

l) Access to Infrastructure

The sharing with other industry participants of transportation and operating infrastructure (such as gas processing facilities and gas pipelines) is common in the gas sector. As such, the Company will rely on access to properly maintained operating infrastructure and shared facilities that in some circumstances may not be directly controlled by the Company in order to deliver its production to market. Any delay or failure to access properly maintained operating infrastructure or shared facilities may have a material adverse effect on the Company.

m) Speculative Nature of Investment

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The above list of risk factors are not to be taken as exhaustive of the risks faced by the Company or by investors in the Company.

Whether or not income will result from projects undergoing exploration, development and production programs is dependant on the successful establishment of exploration operations. Factors including costs, equipment availability, oil and gas prices affect successful project development as does the design and construction of efficient production facilities, competent operation and management and prudent financial administration, including the availability and reliability of appropriately skilled and experienced consultants and staff. In particular, changes in global economic conditions (including changes in interest rates, inflation, foreign exchange rates and labour costs) as well as general trends in the Australian and overseas equity markets may affect the Company's operations and particularly the trading price of the Shares on the ASX.

Shareholders should consider that the investment in the Company is speculative and should consult their professional advisers before deciding whether to apply for the Shares.

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7. Additional Information

Litigation

So far as the Company is aware, there are no legal or arbitration proceedings, active or threatened against, or being brought by, the Company which may have a material effect on the Company’s financial position.

Underwriting Agreement between the Company and Wilson HTM Corporate Finance

Wilson HTM has agreed to underwrite the Offer under the terms of the Underwriting Agreement.

Under the terms of the Underwriting Agreement:

Wilson HTM will subscribe for all New Shares that are not taken up under the Offer and all other shares that would have been allocated under the Offer to shareholders outside of Australia or New Zealand had the Offer been extended to those shareholders and been taken up in full by those shareholders (together, the Underwritten Shares );
the Company must pay to Wilson HTM a commission of 3.75% of the amount underwritten and a management fee equal to 1.5% of the amount underwritten. The Company must also reimburse Wilson HTM for its legal costs and disbursements in relation to the Underwriting Agreement and the Offer and other out of pocket expenses such as travel and accommodation expenses, sundries, stamp duty and third party costs;
Wilson HTM’s obligation to subscribe for the Underwritten Shares is conditional on:
(a) the ASX granting permission for official quotation of the Underwritten Shares; and
(b) the Company providing to Wilson HTM a notice stating the subscription shortfall as at the closing date and a certificate signed by 2 directors as to matters concerning the conduct of the Offer,

by the time prescribed in the Underwriting Agreement for those events to occur;

in addition to other customary representations and warranties made to Wilson HTM, the Company represents and warrants to Wilson HTM that:
(a) the Company has complied with all relevant legislation, regulations, binding policies and guidelines in relation to the Offer;
(b) to the best of the Company’s knowledge, the Offer Booklet and other information made available to the public will not contain any material

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statement that is misleading or deceptive or likely to mislead or deceive and the Company has not and will not engage in such conduct;

(c) the Company will not do or omit to do anything that is or may be likely to materially prejudice the prospects of the Offer; and
(d) the Company has not and will not offer to sell shares to any person in the United States of America or to any US person other than in compliance with applicable legislation;
the Company undertakes (amongst other things) to:
(a) refrain from allotting or agreeing to allot shares or other securities other than in accordance with the Offer or arrangements already in place as at the date of the Underwriting Agreement until the date that is 3 months after the last allotment date, unless it has offered Wilson HTM a first and last right of refusal to underwrite and manage the share issue;
(b) refrain from making any material statement concerning the Offer without Wilson HTM’s prior written consent; and
(c) promote the Offer and use reasonable endeavours to procure valid applications for the New Shares;
if the Company terminates the Underwriting Agreement for any reason other than a material breach, negligence, misconduct etc by Wilson HTM and the Company proposes a similar offer within 6 months of that termination, the Company must pay Wilson HTM 50% of the fees that Wilson HTM would have received if the commission and management fee in paragraph 2 above applied to the subsequent fundraising (unless Wilson HTM is offered the right to act as a manager and underwriter for the subsequent fundraising);
Wilson HTM may terminate the Underwriting Agreement in a number of circumstances, including, but not limited to:
(a) failure by the Company to obtain ASX approval under the Listing Rules or approval for official quotation of the Underwritten Shares on the ASX is not granted by the time specified in the Underwriting Agreement;
(b) there is a material adverse change in the Company or its related bodies corporate, or the S&P/ASX 200 Index falls by more than 10%;
(c) the Company withdraws or terminates the Offer or an event occurs which causes the Company to allow shareholders who have accepted the Offer to withdraw their acceptances;
(d)
the ASX suspends quotation of the shares of the Company;
(e) an event specified in section 652C(1) or section 652C(2) of the Corporations Act occurs;

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(f) any information supplied to Wilson HTM or in the Offer Booklet is misleading or deceptive or likely to mislead or deceive in a material respect;
(g) the Company materially fails to comply with legislative or regulatory requirements or the Offer does not comply in a material respect with relevant legislation, regulations or binding policies or guidelines; or
(h) the Company breaches its material obligations under the Underwriting Agreement,

however that ability to terminate is limited to where the event has a material adverse effect on the success of the Offer or may lead to Wilson HTM being liable for a breach of relevant legislation;

the Company indemnifies and will keep indemnified Wilson HTM and its officers, employees, advisers and agents for losses incurred directly as a result of or in connection with (amongst other things):
(a) the Offer Booklet (including errors in the Offer Booklet);
(b) the allotment of shares;
(c) the representations and warranties given by the Company being inaccurate in any material respect or the Company otherwise materially failing to perform its obligations in relation to the Offer (including compliance with the Underwriting Agreement);
(d) any termination event occurring; or
(e) a claim that an indemnified party may have under the Corporations Act, the Listing Rules or any other relevant law or binding policy or guideline,

except where the loss results from fraud, recklessness, negligence, breach of legislation or contract by the indemnified party or a material breach of the Underwriting Agreement by the indemnified party.

Sub-underwriting

Wilson HTM has entered into individual sub-underwriting agreements with a number of sub-underwriters including each of the following (each being a Sub-Underwriter ):

Waterford Pacific Pty Ltd atf The McKay Family Trust (being an entity in which James McKay (Director) has an interest) ( Waterford ).
Gilby Resources Pty Ltd atf The Gilby Investment Trust (being an entity in which Tony Gilby (a proposed Director) has an interest) ( GR );
Pieters Capital Pty Ltd atf The Pieters Investment Trust (being an entity in which Chris Pieters (Director) has an interest) ( PC ); and
SAAD, an associate (as that term is defined in the Corporations Act) of AWAL Bank BSC, being an entity in the SAAD group of companies. Citicorp Nominees Pty Ltd holds Shares for the benefit of AWAL Bank BSC.

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Waterford as at the date of this Offer Booklet holds 20,752,620 Shares and 5,150,000 Options (being 8.1% of the voting power of the Company and 9.0% on a fully diluted basis). Waterford has separately committed to subscribe for up to a maximum $3,124,999.98 of any shortfall (being 11,574,074 New Shares under the Offer at the Issue Price, as may be required by the Underwriter. If Waterford takes up its full entitlement under the Offer (as it has committed it will do) and is required to subscribe for the maximum number of New Shares under its sub-underwriting agreement, its holding will be 36,477,218 Shares (being 11.9% of the voting power of the Company and 12.2% on a fully diluted basis**).

As at the date of this Offer Booklet GR holds 20,623,896 Shares and 5,150,000 Options and Anthony Rechka Gilby atf Fleur Jade Gilby holds 257,500 Shares (being in aggregate 8.2% of the voting power of the Company and 9.0% on a fully diluted basis). GR has separately committed to subscribe for up to a maximum $3,124,999.98 of any shortfall (being 11,574,074 New Shares under the Offer at the Issue Price, as may be required by the Underwriter. If GR and Anthony Rechka Gilby take up their respective full entitlement under the Offer (as each has committed it will do) and GR is required to subscribe for the maximum number of New Shares under its subunderwriting agreement, the aggregate holding of GR and Anthony Rechka Gilby atf Fleur Jade Gilby will be 36,631,749 Shares (being in aggregate 11.9% of the voting power of the Company and 12.3% on a fully diluted basis*).

PC as at the date of this Offer Booklet holds 1,287,500 Options (being 0.4% of the voting power of the Company on a fully diluted basis). PC has separately committed to subscribe for up to a maximum $3,124,999.98 of any shortfall (being 11,574,074 New Shares under the Offer at the Issue Price, as may be required by the Underwriter. If PC is required to subscribe for the maximum number of New Shares under its subunderwriting agreement, its holding will be 11,574,074 Shares (being 3.8%* of the voting power of the Company and 3.8% on a fully diluted basis).

The effect of SAAD’s sub-underwriting agreement and holdings in the Company together with that of Citicorp Nominees in set out in Section 5.

This indicates the corresponding voting power following the issue of the Placement Shares.
** This indicates the corresponding voting power following the issue of the Placement Shares and the issue of Shares if the 32,867,500 Options on issue were exercised and the corresponding Shares were issued.

Any corresponding New Shares to be issued to each Sub-underwriter under their respective sub-underwriting agreements will be issued at the same time as the issue of New Shares.

In agreeing to enter into its individual sub-writing agreement with the Company, Waterford, GR and PC will each be paid a cash fee of up to 3.75% of their respective maximum sub-underwriting commitment referred to above. These fees will be paid by the Underwriter and not the Company. No fees are payable to SAAD in respect of its sub-underwriting commitment.

The disclosure above in respect of Waterford, GR and PC is for the purpose of satisfying Listing Rule 10.11 and Exception 2, in respect of the issue of securities to related parties of an issuer, in connection with a pro rata issue.

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Indemnities

The Company has indemnified the Underwriter, its related corporations, and their respective directors, officers, employees and agents against any claims, demands, damages, losses, costs, expenses and liabilities incurred directly or indirectly in connection with the Offer Booklet or the Offer. The indemnity provided by the Company does not extend to any losses to the extent those losses are judicially determined to result from any fraud, wilful misconduct, gross negligence or material breach of contract of by an indemnified party.

Wilson HTM Investment Group Ltd, the parent company of the Underwriter, is a public company whose shares are traded on the ASX. Certain Directors, officers and employees of the Company and their affiliates may hold shares in Wilson HTM Investment Group Ltd.

Withdrawal of Entitlements Offer

The Directors reserve their right to withdraw all or part of the Offer at any time prior to the issue of New Shares, in which case Comet Ridge will refund Application Monies in accordance with the Corporations Act without payment of interest.

Reliance on Offer Booklet

This Offer Booklet has been prepared pursuant to the requirements of section 708AA of the Corporations Act. In general terms, section 708AA relates to entitlements issues by certain companies that do not require the provision of a prospectus or other disclosure document. Accordingly, the level of disclosure in this Offer Booklet is considerably less than the level of disclosure required in a prospectus. In deciding whether or not to accept the Offer, you should rely on your own knowledge of the Company, and refer to disclosures made by the Company to ASX and ASIC (which are available for inspection on the ASX website at www.asx.com.au and on the Company’s website at www.cometridge.com.au and seek the advice of your professional adviser. The Company is a disclosing entity for the purposes of the Corporations Act and, as such, is subject to regular reporting and disclosure obligations. Specifically, as a listed company, the Company is subject to the disclosing obligations under the Listing Rules and the Corporations Act

If you have any questions about your entitlement to New Shares, please contact either:

the Company’s Share Registry, Computershare Investor Services Pty Limited on 1300 557 010; or
your stockbroker or professional adviser.

Overseas jurisdictions

This Offer Booklet does not, and is not intended to, constitute an offer, invitation or issue in any place in which, or to any person to whom, it would be unlawful to make such an offer, invitation or issue. By applying for New Shares, including by submitting the Entitlement and Acceptance Form or making a payment by BPAY[] you represent and warrant that there has been no breach of such laws.

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The distribution of this Offer Booklet outside of Australia may be restricted by law and persons who come into possession of it should seek advice and observe any such restrictions. Any failure to comply with such restrictions may contravene applicable securities laws. The Company disclaims all liabilities to such persons. Eligible Shareholders who hold Shares on behalf of persons who are not resident in Australia or New Zealand are responsible for ensuring that taking up New Shares under the Offer does not breach the selling restrictions set out in this Offer Booklet or otherwise violate the securities laws in the relevant overseas jurisdictions.

No action has been taken to register or qualify this Offer Booklet, the New Shares or the Offer, or otherwise to permit a public offering of the New Shares, in any jurisdiction outside Australia and New Zealand. The following international restrictions relate to the issue of New Shares under the Offer:

New Zealand : The Offer Booklet does not constitute a prospectus or investment statement and has not been registered, filed with or approved by any New Zealand regulatory authority under or in connection with the Securities Act 1978 (New Zealand). The Offer is being made only to, Eligible Shareholders with registered addresses in New Zealand in reliance on the Securities Act (Overseas Companies) Exemption Notice 2002 (New Zealand). This Offer Booklet is not an investment statement or prospectus under New Zealand law, and may not contain all the information that an investment statement or prospectus under New Zealand law is required to contain.

United Kingdom: This Offer Booklet is issued by the Company on a confidential basis to existing Shareholders of the Company or qualified investors (within the meaning of the Financial Services and Markets Act 2000 of the United Kingdom). This Offer Booklet should not be distributed, published or reproduced, in whole or in part, nor should its contents be disclosed by recipients to any other person. This Offer Booklet is being distributed only to, and is directed at: (a) persons outside the United Kingdom; or (b) persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotions) Order 2005 (c) existing Shareholders or (d) persons, being fewer than 100 in number, to whom it may otherwise be lawfully communicated (together “relevant persons”). The investments to which this Offer Booklet relates are available only to, and any invitation, offer or agreement to purchase will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this Offer Booklet or any of its contents.

Switzerland : The New Shares may not be offered or sold, directly or indirectly, in Switzerland except in circumstances that will not result in the offer of the New Shares being a public offering in Switzerland within the meaning of the Swiss Code of Obligations (CO). Neither this Offer Booklet nor any other offering or marketing material relating to the New Shares constitutes a prospectus as that term is understood pursuant to article 652a or 1156 CO, and neither this document nor any other offering material relating to the New Shares may be publicly distributed or otherwise made publicly available in Switzerland. The Company has not applied for a listing of the New Shares on the SIX Swiss Exchange and, consequently, the information presented in this Offer Booklet does not necessarily comply with the information standards set out in the listing rules of the SIX Swiss Exchange.

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France: The Offer does not constitute a public offering in France and does not require a prospectus approved by the Autorités des Marchés Financiers.

The entities providing portfolio management services on behalf of a third party can participate in the offer as well as the qualified investors and other persons falling within the scope of a restricted circle of investors only if they participate in such offer for their own account in accordance with the provisions of articles D.411-1, D.411-2, D.734-1, D.744-1, D.754-1 and D.764-1 of the French Code Monétaire et Financier .

A qualified investor is an individual or an entity having the necessary skills and means to understand the risks inherent to transactions on financial instruments. A list of these qualified investors is provided by article D.411-1 of the French Code Monétaire et Financier and is available on the French legifrance website (www.legifrance.gouv.fr). In accordance with the 2003/71/EC Directive dated 4 November 2003, a qualified investor is also any individual or entity regarded as such in any Member State to the European Economic Area. A restricted circle of investors is made up of 100 individuals and/or entities other than the qualified investors.

The Company shares to be subscribed to by such investors can only be subsequently offered, directly or indirectly, to the public in France in accordance with the provisions of articles L.411-1, L.411-2, L.412-1 and L.621-8 to L.621-8-3 of the French Code Monétaire et Financier .

Hong Kong – WARNING: The contents of this Offer Booklet have not been reviewed or approved by any regulatory authority in Hong Kong. Recipients are advised to exercise caution in relation to any offer of New Shares. If recipients are in any doubt about any of the contents of this document, they should obtain independent professional advice. The New Shares and Entitlements have not been offered or sold and will not be offered or sold in Hong Kong, by means of any document other than:

(i) to “professional investors” as defined in the Securities and Futures Ordinance (Cap.571) of Hong Kong and any rules made under that ordinance; or
(ii) in other circumstances which do not result in the document being a “prospectus” as defined in the Companies Ordinance (Cap.32) of Hong Kong or which do not constitute an offer to the public within the meaning of that ordinance.

Further, no person shall issue or have in its possession for the purpose of issue, whether in Hong Kong or elsewhere, any advertisement, invitation or document relating to the New Shares and Entitlements, which is directed at, or the contents of which are likely to be assessed or read by, the public in Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than respect to New Shares and Entitlements which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” as defined in the Securities Futures Ordinance (Cap.571) and any rules made under that ordinance.

The information relating to the offering contained herein may not be used other than by the person to whom it is addressed and may not be reproduced in any form or transferred to any person in Hong Kong. This offering is not an offer for sale to the public in Hong Kong and it is not the intention of the Company that the New Shares and Entitlements be offered for sale to the public in Hong Kong.

Non-renounceable entitlement offer

Governing Law

This Offer Booklet, the Offer and the contracts formed on acceptance of applications are governed by the laws of Queensland, Australia. Each applicant for New Shares submits to the exclusive jurisdiction of the courts of Queensland, Australia.

Non-renounceable entitlement offer

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8. Glossar y

A$ or Dollars	means dollars in Australian currency (unless otherwise stated).
ABN	means Australian Business Number.
Application Monies	means the aggregate amount of money payable for Shares applied for calculated by multiplying A$0.27 by the number of New Shares subscribed for.
ASIC	means the Australian Securities and Investments Commission.
ASTC	means ASX Settlement and Transfer Corporation Pty Ltd ACN 008 504 532.
ASX	means the Australian Securities Exchange.
ASX Limited	ASX Limited ACN 008 624 691.
Board	means the board of Directors of the Company.
Chartwell Energy	Chartwell Energy Limited ABN 123 462 251
CHESS	means Clearing House Electronic Sub-register System of ASTC.
Citicorp Nominees	Citicorp Nominees Pty Limited (which holds Shares for the benefit of AWAL Bank BSC)
Closing Date	means 5:00 pm WST time on Thursday, 18 June 2009 date as may be determined by the Directors.
Comet Ridge	means the Company.
Company	means Comet Ridge Limited ABN 47 106 092 577.
Corporations Act	means the Corporations Act 2001 (Cth).
Directors	means the directors of the Company.
Eligible Shareholder	means a registered holder of Shares at 5:00 pm WST time on the Record Date of Wednesday 27 May 2009 (excluding any Shareholders with addresses outside Australia and New Zealand, which the Company considers it is not reasonable to make an offer).
Entitlement or Entitlements	means the non-renounceable entitlements to subscribe for New Shares on the basis of 1 New Share for every 5 Shares on the Record Date.
Entitlement and Acceptance Form	means the form accompanying this Offer Booklet which sets out the entitlements of Eligible Shareholders under the Offer.
Group	means the Company and Comet Ridge Limited.
Issue Price	means A$0.27 per New Share.
Lead Manager or Underwriter or Wilson HTM	means Wilson HTM Corporate Finance Limited ACN 057 547 323.

Non-renounceable entitlement offer

Listing Rules	means the official listing rules of ASX Limited, as amended from time to time.
New Share or New Shares	means a new fully paid share of common stock in the capital of the company to be issued pursuant to this Offer.
Offer	means the offer of New Shares under this Offer Booklet.
Options	means an unlisted option to subscribe for a Share.
Offer Booklet	means this Offer Booklet dated 18 May 2009 and includes any amendment or replacement summary document.
Placement Shares	means 22,000,000 Shares for which as at the date of this Offer Booklet offers have been made by the Company to certain investors and subscriptions have been received under a private placement.
Record Date	means Wednesday 27 May 2009 or such other date as may be determined by the Directors.
Regulation S	means Regulation S promulgated under the US Securities Act.
SAAD	means SAAD Investment Company Limited an associate (as that term is defined in the Corporations Act) of AWAL Bank BSC, which is part of the SAAD group of companies.
SEC	means the United States Securities and Exchange Commission.
Shares	means a fully paid ordinary share in the capital of the Company.
Shareholder	means a holder of Shares in the Company.
Share Registry	means Computershare Investor Services Pty Limited ACN 078 279277
Underwriting Agreement	means the underwriting agreement dated 18 May 2009 between the Company and the Underwriter with respect to the Offer.
US$ or US dollars	means dollars in United States currency.
US Exchange Act	means the US Securities and Exchange Act of 1934, as amended.
US Person	means, among other things and subject to certain exceptions: (i) any natural person resident in the US, (ii) any partnership, corporation or other entity organised or incorporated in the US, (iii) any trust of which any trustee is a US person, (iv) any agency or branch of a foreign entity located in the US, (v) any account held by a dealer or other fiduciary that either is organised, incorporated or resident in the US or holds for the benefit or account of a US Person, or (vi) any partnership or corporation that is organised or incorporated in a foreign jurisdiction by a US person principally for the purpose of investing in securities not registered under the US Securities Act.
US Securities Act	means the United States Securities Act of 1933, as amended.
WST	means Western Standard Time (Perth, Australia).

Non-renounceable entitlement offer

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9. Corporate Directory

Board of Directors

Jeff Schneider (Non-Executive Chairman) Tor McCaul (Managing Director) Gillian Swaby (Non-Executive Director) James McKay (Non-Executive Director) Chris Pieters (Non-Executive Director) Stephen Rodgers (Company Secretary)

Registered Office in Australia

C/- Endeavour Corporate Suite 8,7 The Esplanade Mt Pleasant Western Australia 6153 Phone: +61 8 9316 9100 Facsimile: +61 8 9315 5475 Website: www.cometridge.com.au ASX code: COI

Auditors

Johnston Rorke Level 30, Central Plaza 1 345 Queen Street Brisbane QLD 4000

Legal Adviser

Porter Davies Lawyers Level 5 46 Edward Street Brisbane QLD 4000 Australia

Brisbane Office: 210 Alice Street Brisbane QLD 4000 Telephone: +61 7 3221 3661 Facsimile: +61 7 3221 3668

Share Registry

Computershare Investor Services Pty Limited Level 2 45 St Georges Terrace Perth WA 6000 Australia Telephone: 1300 557 010 Facsimile: +61 8 9323 2033 Email: [email protected]

Lead Manager and Underwriter

Wilson HTM Corporate Finance Limited Level 38 Riparian Plaza 71 Eagle Street Brisbane QLD 4000 Australia

AI assistant

COMET RIDGE LIMITED — Capital/Financing Update 2009

64686_rns_2009-05-17_e747661b-aec1-437a-ba59-55b89d5835a4.pdf

NON-RENOUNCEABLE ENTITLEMENT OFFER

Table of Contents

Important Information

Not investment advice

Overseas Shareholders

No Entitlement trading

Underwriting/sub-underwriting

Future performance

Financial forecasts and other forward looking statements

No representations other than as set out in

this Offer Booklet

Defined terms

1. Ke Offer Information y

Summary Offer Information

Indicative Timetable

2. Chairman’s Letter

3. Details of the Offer

The Offer

No Entitlements Trading

Closing Date

Underwriting/Sub-Underwriting

Issue of New Shares

Ranking of New Shares

CHESS

Market prices of Shares

Overseas Shareholders

Taxation

Risks

Questions

4. What Eligible Shareholders May Do

This section relates to Eligible Shareholders.

If you wish to take up all of your Entitlement to New Shares

Entitlement to New Shares not taken up

Entitlement and Acceptance Form is binding

5. Company Overview and Effects of the Offer

Overview

Summary of Operations

Key Projects

Galilee Basin

Mahalo Project – Bowen Basin

Greymouth – New Zealand

Secondary Projects

Gunnedah Basin

Buller Block – New Zealand

North Waikato Block – New Zealand

United States

Use of Funds

Directors

Jeff Schneider Non-Executive Chairman

Tor McCaul Managing Director

Gillian Swaby Non-Executive Director

James McKay Non-Executive Director

Chris Pieters

Non-Executive Director

Unaudited Pro-forma Balance Sheet

Directors’ intentions

Expenses of the Offer

Control and capital structure

6. Risk Factors

Introduction

Risks Specific to an Investment in Comet Ridge

a) Volatility of oil and gas prices and markets

b) Native Title

c) Exploration and Production

d) General Project Risks

e) Operating Risks

f) Joint Venture or Farmin Risks

g) Commercialisation

h) Environmental Regulation and Risks

i) Legislative Change

j) Reserves Risk

k) Additional Funding Requirements

l) Access to Infrastructure

m) Speculative Nature of Investment

7. Additional Information

Litigation

Underwriting Agreement between the Company and Wilson HTM Corporate Finance

COMET RIDGE LIMITED Capital/Financing Update 2009