The company is offering investors 125 million new shares at an application price of 20 cents per new share together with a 1:2 free attaching option to raise up to $25 million.

At the offer price, the company will have a market capitalisation of $40.4 million. Following the offer, public shareholders will control about 65% of the company’s issued capital.

Central Petroleum has an operating portfolio of about 165,000 square kilometres, which includes most of the available prospective acreage in central Australia, including the Perdika and Amadeus basins in the Northern Territory.

“We have negotiated a package deal delivering 100% ownership over most of the prospective portions of the entire Amadeus Basin, which surrounds the producing Palm Valley and Mereenie fields, once Australia’s biggest onshore mainland reserves,” said managing director John Heugh.

"This region is demonstrably under-explored and has the potential to transform Central Petroleum into a serious player in the petroleum industry.

"The company holds a highly prospective portfolio of under-explored onshore acreage that has the potential to hold very large accumulations. It also has the potential to rapidly monetise oil discoveries via the new Alice Springs to Darwin rail link and monetise gas reserves using gas-to-liquids technology."

Central is planning a total of six wells in its first two-year program targeting 300 million barrels of oil, 3.4 trillion cubic feet of gas and 105 billion cubic feet of helium, a high-priced commodity in big demand.

Central was formed by John Heugh and Richard Faull in 1998 when oil was trading at $US12 a barrel to get after big targets in big acreage positions in a counter cyclical investment strategy. Since then the company has progressively added to its asset portfolio.