Australia's Vintage raises capital to upscale Odin gas project

Vintage Energy on March 25 announced an A$8mn ($5.2mn) capital raising to fund near-term growth in its gas production and revenue generation from the Odin gas field in the South Australian Cooper Basin.

The capital raising comprises an A$1.3mn institutional investor private placement and an A$6.7mn accelerated non-renounceable entitlement offer. This move will result in the issue of 799.6mn new ordinary shares, all priced at 1 cent/share. Notably, the offer price represents a 37.5% discount to the last closing price of 1.6 cents/share on March 22.

Vintage intends to utilise the raised funds primarily for drilling two appraisal wells, Odin-2 and Odin-3. Furthermore, if successful, the funds will also be allocated towards the completion and connection of one of these wells to augment gas production and sales from the Odin gas field, as stated by the company.

Odin-1 commenced production in September 2023, with all gas supplied to Pelican Point Power, a joint venture of Engie (72%) and Mitsui (28%), under a sales agreement extending to December 2026. The Odin gas supply contract was negotiated in 2023, and Vintage, along with its joint venturers in Odin, are exempt from the $12/GJ price cap.

“This capital raising will enable Vintage to push on to increase gas production and cash generation from the Odin gas field. Odin-1 has performed well since coming online and we are keen to replicate this and increase sales under the supply contract we hold with Pelican Point Power by stepping up production from the field.” said Managing Director, Neil Gibbins.

Odin is the second new gas field brought into supply by Vintage and the joint venture, following the connection of the Vali gas field in Queensland in February 2023. Gas from Vali and Odin is processed at the Moomba processing facility.