A shareholders meeting in Wellington yesterday was told that Austral was financially stretched and needed more cash for planned projects, according to the Dominion Post newspaper.
Hill said the company could issue convertible preference shares to raise up to $US35 million from the United States, but he would also like to see more investment from New Zealand.
Wellington-headquartered Austral, in conjunction with Canadian listed junior TAG Oil, recently spent about $NZ30 million ($A25.4 million) developing the small onshore Cheal oil field, with initial flows presently about 850 barrels of oil per day.
And any decision to develop the troublesome nearby Cardiff gas field, which could cost $US100 million or more, would require further capital raising, the paper quoted Hill as saying.
Austral made a loss of $US13.4 million for 2006.
Late last month, Austral said it was about to test the Cardiff-2A sidetrack, after a well workover by the Parker Drilling International Rig 252.
The workover is planned to be completed, with the well ready for testing, by late October, with the full test scheduled to take place in November.
Last year’s flow testing of the McKee and K1A sands had demonstrated sufficient commerciality to secure a petroleum mining permit, according to Austral.
But no economically recoverable reserves have officially been assigned to Cardiff, although Canadian independent consultants Sproule International estimated "probabilistic" gas in place exceeding 215 billion cubic feet (50%) and 341 Bcf (10%), plus 12.8 million (50%) and 21.5 million barrels (10%) of condensate.
Yesterday Hill said that sort of resource for Cardiff, if proved, would help Austral greatly in raising further funds.
However, it might be Christmas before Austral had a clear indication of whether Cardiff would deliver commercial qualities of gas at viable rates, of at least three million cubic feet per day.
Hill said any development of Cardiff would be a phased program involving up to 15 development wells, plus processing plant and pipelines.
The Cheal partners are operator Austral (69.5%) and TAG Oil (30.5%).
The Cardiff partners are operator Austral (44.9%), integrated energy company Genesis Energy (40%), and TAG (15.1%).
