Coal seam gas explorers within New South Wales have spiked in their first trading session since incoming federal Industry Minister Ian Macfarlane said he would push hard for CSG development in the state.
Embattled CSG company Metgasco (MEL), which has a market capitalisation of just $34 million, lifted 22.6% to 7.6 cents at 1400 AEST – its biggest increase in over a year.
The company was forced to suspend its operations in the New South Wales northern rivers region back in March, blaming new regulations and administration procedures from the state government. Since then it has had to "significantly" cut staff and focus on cost reductions, while pursuing opportunities outside the state.
It's larger rival Dart Energy (DTE), which owns seven sites within NSW and has a market capitalisation of $122 million, has jumped 8.7% to 12.5 cents.
Like Metgasco, Dart was pressed to focus outside of NSW. Earlier this month the company undertook a $20.7 million capital raising to reposition the company's strategy on its assets in the United Kingdom, retaining its assets in NSW on a "care and maintenance basis".
"Current NSW government policy is such as to materially impact the near term prospects for CSG development on much of the company's licence areas," Dart said.
But yesterday Macfarlane said development of Australia's natural gas industry would be a priority – especially within New South Wales – as he dismissed opposition to the CSG industry as unscientific.
"I'm not interested in noisy protesters, minority groups, with no interest in the development of regional Australia and the economic progress of agriculture and mining together," he said.