Santos Proposes 'New QGC' to Exploit Coal Seam Gas

Under a proposal announced by Santos Tuesday, Santos would require Queensland Gas Company Limited ("QGC") to establish a new ASX-listed company to boost the development of Queensland's coal seam gas industry.

Under the proposal, Santos would pay QGC shareholders $1.30 per share in cash for all of their shares in return for the acquisition of QGC's Undulla Nose coal seam gas assets in southeast Queensland.

In addition, QGC shareholders would also receive shares on a one-for-one basis in a "New QGC" that would own a number of QGC's existing highly prospective tenements. The "New QGC," led by the current QGC board and management team, would focus on immediately commercializing these coal seam gas assets.