Troubled Australian Coal Seam Gas Explorer Metgasco Reports A$2.1 mn Loss

Australian coal seam gas explorer Metgasco has reported a A$2.1 million operating loss for the half year ended December 31, 2014 as it fights New South Wales government’s decision to suspend drilling license in Bentley.

“The operating loss includes significant legal expenses associated with the NSW Supreme Court action against the NSW Government to have the suspension of the company's Rosella drilling approval lifted and fees paid to professional advisers assisting with the Elk Petroleum merger,” Metgasco said.

In May last year, the NSW Government's Office of Coal Seam Gas suspended Metgasco's permit to test drill a tight sands gas well on a Bentley property in May. The Government said that he decision was taken on the basis that Metgasco had not met its obligations to consult with the community.

The company is still waiting on a decision regarding the suspension of drilling approval.

In an attempt to diversify its activity outside NSW, Metgasco decided announced that it has entered into a merger with Elk Petroleum Limited. This would result in a geographically diversified portfolio of exploration and advanced development assets, with exposure to coal seam and conventional gas in New South Wales, Australia; and oil-producing Rocky Mountain region of the United States of America.