Money for hot rocks
Geothermal junior conducts capital raising for expansion down south.
Panax Geothermal has hired Toronto-based investment bank Dundee Securities Corp to help it raise up to $30 million in new equity at the same time as it proposes a merger with unlisted geothermal exploration company Osiris Energy.
Panax has turned to Dundee because of its success in raising finance for geothermal companies in North America and Europe.
The company expects to have at least $35 million in cash following the raising, which it will use to fund a drilling program and the establishment of a pilot geothermal energy plant on South Australia's Limestone Coast in late 2009. It says this could be the fore-runner of Australia's first commercial and grid linked geothermal power station.
Panax is seeking the merger with Osiris because of its database and geothermal acreage in the Otway and Cooper basins. It will offer 70 million of its own shares, valuing Osiris at $14.8 million and giving Osiris founders Ian Reid and Ron Palmer a combined 38.7 per cent stake in the merged company.
Panax CEO Dr Bertus de Graaf says the merger will enhance the profile of Panax as a "player” in the international clean energy sector.
De Graaf says the Otway Basin could have enough geothermal resources to support 1500Mw of generation, the equivalent of two coal fired power stations
While other companies are looking to exploit hot fractured rock projects, Panax is focusing on reservoirs containing hot geothermal fluids, which it expects to have a much shorter development time.
Still, de Graaf says geothermal resources of any type are still not valued by the market according to their commercial potential for the long term generation of clean base-load power.
Panax has turned to Dundee because of its success in raising finance for geothermal companies in North America and Europe.
The company expects to have at least $35 million in cash following the raising, which it will use to fund a drilling program and the establishment of a pilot geothermal energy plant on South Australia's Limestone Coast in late 2009. It says this could be the fore-runner of Australia's first commercial and grid linked geothermal power station.
Panax is seeking the merger with Osiris because of its database and geothermal acreage in the Otway and Cooper basins. It will offer 70 million of its own shares, valuing Osiris at $14.8 million and giving Osiris founders Ian Reid and Ron Palmer a combined 38.7 per cent stake in the merged company.
Panax CEO Dr Bertus de Graaf says the merger will enhance the profile of Panax as a "player” in the international clean energy sector.
De Graaf says the Otway Basin could have enough geothermal resources to support 1500Mw of generation, the equivalent of two coal fired power stations
While other companies are looking to exploit hot fractured rock projects, Panax is focusing on reservoirs containing hot geothermal fluids, which it expects to have a much shorter development time.
Still, de Graaf says geothermal resources of any type are still not valued by the market according to their commercial potential for the long term generation of clean base-load power.
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