Additionally the company is placing up to 26,450,000 shares and 12,500,000 converting notes with professional or sophisticated investors at the same price to raise up to $4.674 million.

This price represents an 8.3% discount to the closing price of 13 cents on the ASX, the day before the plan and the private placement of shares and notes were announced.

The plan provides for the issue of a maximum of 25,000,000 ordinary shares raising a total of $3 million with the funds raised to be used for gas exploration and development and working capital.

ESG is about to embark on an active program of drilling in PEL 238, targeting both additional conventional gas reserves and significant new reserves of CBM. Success in this program will enable an early expansion of the power station at Narrabri, and lay the foundations for the eventual export of gas from the region.