The Company is wasting no time implementing its exploration program, scheduling the spudding next month of a wildcat oil well in the Cooper Basin - ahead of Enterprise Energy's anticipated listing on the ASX at the beginning of May, 2004.
A second well, targeting gas, will be drilled in the Cooper Basin also in May.
Enterprise said it planned to raise $6 million through a Public Offer and a further $2.47 million through a Rights Issue to existing Enterprise shareholders.
Both the Rights Issue and the Public Offer are fully underwritten by PCP Securities Limited.
The Adelaide-based company will use the proceeds to earn interests of up to 50% in a suite of petroleum assets in the Cooper, Surat, Canning and Amadeus Basins.
Six wells in 2004
Enterprise plans to participate in five wildcat exploration wells and one development well in the first year at a cost of $4.65 million, with the Cooper Basin in SA being the location of the first two targets. Participation in up to five wells is planned in the second year.
The first well, Acacia Grove-1 (Enterprise Energy earning up to 20% in joint venture with Liberty Petroleum Corporation Inc and Cooper Energy NL), will be drilled late in April in PEL 100, targeting an estimated 780,000 barrels of oil.
The acreage has several additional strong leads.
Enterprise Energy will immediately follow Acacia Grove-1 in drilling the Smegsy Block to earn a 25% interest in a joint venture with Great Artesian Oil and Gas. This is a gas prone area of the southwestern portion of the Patchawarra Trough in the Cooper Basin's PEL 106.
The well, which will target a prospect estimated to contain 18.9 billion cubic feet of gas, is in the same acreage as this year's Nutmeg gas discovery and near to the currently drilling Paranta-1 well which already has hydrocarbon shows.
The Surat Basin interests being acquired comprise two production licenses containing the producing Yellowbank Creek oil field and the currently shut-in Thomby Creek, Louise and Narrows oil fields.
It will also acquire a 15% interest in the development of a gas discovery in Western Australia, by contributing 20% of the cost of drilling a second well on the structure of the Point Torment-1 gas discovery, drilled in 1992 in the Canning Basin.
Non renounceable rights issue to existing Enterprise Shareholders
Enterprise Energy is the new entity to emerge from a shareholder-approved restructure on January 5th this year of former mining company, Enterprise Gold Mines NL, into Australia's newest oil and gas explorer.
Under the non-renounceable rights issue, Enterprise shareholders can subscribe for a total of 12.37 million shares at 20 cents per share on a 5-for-1 basis, to raise approximately $2.47 million, together with one free 20c option per every two shares.
The Public Offer proposes the issue of 30 million shares in Enterprise at 20 cents per ordinary share to raise $6 million, together with one free 20c option per every two shares.
It is anticipated that at listing, Enterprise Energy will have (a minimum) 64.3 million shares on issue and be valued at $12.86 million.
Both Offers open on 2 April 2004 and are due to close on April 16, 2004.
Early cash flow potential
"The assets being acquired offer the potential for early cash flow from the Surat Basin and give the Company a strong Cooper Basin focus," Enterprise Energy's Managing Director, Mr. Warren Leslie, said today.
"The recent exploration successes of new explorers in the SA section of the Cooper Basin re-confirm the high prospectivity of the Cooper-Eromanga Basin," Mr. Leslie said.
"The six wells to be drilled in the first year of operation are targeting a potential upside of 40 million barrels of oil equivalent (mmboe) within a mix of low risk and large, high risk structures," he said.
"Many of the lower risk targets are also adjacent to infrastructure, enabling cost efficient production from any commercial discoveries."
Eastern seaboard gas potential
Mr. Leslie, a 40-year veteran in the Australian and international oil and gas industries, said the predicted shortfall of natural gas production in Australia for markets in the southern and eastern states, opened up considerable opportunity to develop new onshore reserves.
"Enterprise Energy will be looking to fill this demand through new discoveries to boost hydrocarbon production from Australia's recognized producing basins," Mr. Leslie said.
"Work will begin immediately with the drilling of the Cooper Basin wildcats, and a development well on one of the Surat Basin properties.
"We also believe Enterprise Energy has a point of difference in the marketplace compared to the companies now focused on the Cooper/Eromanga particularly.
"None of our blocks have outstanding native title issues, production from development wells is an early opportunity for a cash-flow and all preliminary exploration work has been completed for the first years wells."
Joining Mr. Leslie on the Board of Enterprise Energy are Adelaide solicitor, company director and consultant to Minter Ellison, Mr. David Lindh as Chairman; Mr. Clive Armour, the Managing Director of the ATCO Group of Companies and a former senior executive in ETSA Corporation, SAGASCO Holdings and Santos Limited; and Rib Loc Limited and Chariot Limited Chairman and chartered accountant, Mr. Peter Buttery.
The Offer is made in, or accompanied by, a copy of the Prospectus. Anyone wishing to acquire the securities will need to complete the application form that is in or accompanies the Prospectus.
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