PERTH (miningweekly.com) – ASX-listed Comet Ridge has raised A$5-million in a share placement to bolster its working capital position ahead of starting an appraisal programme at the Mahalo North gas project, in Queensland.

The placement comprises the issue of more than 64.4-million new shares at an issue price of 8.25c a share to raise gross proceeds of A$5.3-million.

The placement price represents a discount of 12% to the 20-day volume weighted average share price and 15% to the five-day volume weighted average share price, up to close of trading on 8 September 2021.

“Very pleasingly, this placement was executed following strong demand from high quality institutions who have recognised the benefits of Comet Ridge’s recent transformational deals with Australia Pacific Liquefied Natural Gas (APLNG) and Santos,” said Comet Ridge MD Tor McCaul.

“The company feels it has reached an inflection point where we can now fast-track the final appraisal, leading into the development of Mahalo, with our aligned joint venture (JV), and also optimise value across the acreage by including Mahalo North and East blocks in the development plan. The strong institutional interest is validation of our strategy.

“We are really excited to now go and drill our first development-style, long lateral well in the Mahalo North block, where we feel we have strong prospects for significantly adding to the overall reserves position in the Mahalo area, leading to a bigger project.”

Comet Ridge in August struck an agreement with JV partner APLNG to acquire its 30% interest in the Mahalo gas project, taking its own interest from 40% to 70%.

Comet Ridge will pay A$12-million in cash to APLNG on the completion of the acquisition, and a further A$8-million will be paid post completion in deferred tranches.

The company also executed a funding and option agreement with remaining JV partner Santos, accessing A$13.15-million from Santos to fully fund the up-front acquisition consideration and stamp duty costs, which are due in late 2021.