Arrow Energy Ltd has reached agreement with coal seam gas explorer, Apollo Gas Limited (AOE), for Arrow to take a strategic shareholding stake in Apollo Gas together with Arrow having the right to farm-in to two of Apollo’s coal seam gas tenements to earn up to a 50% interest in each of the two tenements.
Apollo Gas owns seven coal seam gas exploration permits in New South Wales covering 24,000 square kilometres via its 100% owned subsidiary Macquarie Energy Pty Ltd. The tenements cover prospective coal seam gas (CSG) targets in and around Newcastle, the Hunter Valley, Gunnedah and Sydney and are proximate to existing and planned gas transmission pipelines and gas fired power stations.
Arrow has made a seed capital investment in Apollo Gas, acquiring a 21% shareholding interest in Apollo Gas for $4.5 million. Arrow has further rights to maintain its percentage shareholding through the IPO and subsequent capital raisings. Arrow has also entered into Farm-in Agreements providing Arrow with the opportunity to earn up to a 50% interest in two of the coal seam gas tenements.
