PERTH (miningweekly.com) – ASX-listed Comet Ridge is considering the sale of a portion of its 40% interest in the Mahalo gas project, in Queensland, to fund the equity component for the development of the project.
Comet Ridge told shareholders that a partial divestment of the Mahalo gas project would allow the company to concentrate its technical efforts on development of its own fully-owned Mahalo North block.
The Queensland government in early July granted the Mahalo gas project two petroleum leases for a 30-year term, ticking the boxes for the necessary government approvals to proceed to development and production.
Comet Ridge on Thursday said that while the joint venture partners, which include Santos and Australia Pacific Liquefied Natural Gas, had agreed that the project would target a production of 60 TJ/d, the partners had yet to formally agree on a date for a final investment decision or first gas.
Meanwhile, the company noted that it is also unlikely to raise equity funds to undertake an initial pilot drilling campaign at its Mahalo North project, given the current market conditions. The company told shareholders that it has been working with potential partners to bring Mahalo North into production to coincide with the predicted gas shortages in the market, with the negotiations, designed to provide funding for upstream appraisal and development, including gas pre-sales and project equity participation.
The negotiations for Mahalo North could also incorporate a sell-down of part of Comet Ridge’s share of the Mahalo gas project, the company said.