AFR: Gas play Comet raising $22m at 28.6pc discount to pay back Santos debt


ASX-listed Queensland gas explorer Comet Ridge Limited has hired three brokers to raise $22 million, in part to pay back debt owed to Santos which is due just after Christmas.

Comet had Bell Potter, Petra Capital and Taylor Collison offering shares at 17.5¢ each, a 28.6 per cent discount to the last close and 17.4 per cent lower than the 10-day volume weighted average price.

Comet’s got about $23.2 million debt across two lenders: a $10 million warrant backed loan to PURE Asset Management which is due in September, 2025 and a $13.15 million loan from Santos due on December 28. (It also had a $23.9 million liability to CleanCo at June 30, while cash stood at $7.4 million cash at June 30)

Terms sent to potential investors said Comet would use $8.2 million of the placement’s proceeds to pay the Santos loan. That assumed Santos would increase its stake in the Mahalo joint venture block.

If it didn’t pan out, Comet would dip into its working capital or alternate “project equity transactions proceeds” to repay the full $13.15 million to Santos.

The rest of the proceeds were marked for an appraisal program at 100 per cent owned blocks ($7.6 million), corporate, geotechnical and operating staff costs ($5 million) and Mahalo North reserve certification ($1.2 million).

The joint lead managers called for bids by 5pm Wednesday. Comet had an $189.2 million market capitalisation at last close.

Extract Source: The Australian Financial Review