Louisiana Petroleum’s 19 million share offer, priced at 20 cents a share, is due to open on June 29 and the company hopes to start trading its shares on the Australian Stock Exchange on July 22.

Louisiana’s board is made up of Nor Industries Inc president Trevor Johnston (non-executive chairman); Delta Capital executive director Mathew Walker (executive director); ABN Amro executive director David Ledger (non-executive director); and Mining Corporate chief Kent Hunter (company secretary).

The company has an option to buy the leases in the Caddo Pine Island Field for $US1.5 million. Those leases collectively hold 137 wells capable of producing a combined output of 300 barrels a day.

The company is banking on technology used by Metro Energy Group, the company that will be operating its wells, to significantly boost its returns. Metro also partners another Australian-based US energy play, Tomahawk Energy. Its directors Rick Holcomb and John Leenerts are on Tomahawk’s board.

Walker said after listing costs and exercising its purchase option, Louisiana would have about $1.6 million in the bank.

Some of that money will be spent on applying Metro’s casing swab technology to the wells.

Walker said the project would theoretically be cashflow positive from the start because some of the wells on the leases were producing oil.

The area has a long history of oil production but this field has been marginal in the past because of its low flow rates. According to the prospectus, historical data shows the wells in this field have an average flow rate of about 0.5 barrels of oil a day.

Walker said Metro technology could raise the flow rate up to eight-fold.

“We are hopeful of getting about 300 barrels of oil a day out of our operation,” he said.

Taking an oil price of $US50 a barrel (at the time of writing it was nearer $US60) would give an annual revenue of $US5.4 million.

Walker said the company would also be looking to acquire other small operations in the area.

“There are a lot of boutique operations around the area. We’re talking about corn or cotton farmers who are running a few wells on their land,” he said.

The Caddo Pine Island Field is in northern Louisiana, about 32 kilometres north-west of Shreveport Louisiana.

The area is well serviced by oil pipelines linked to major gulf states oil refineries.

According to the independent technical report in the prospectus, prepared by petroleum engineer Donald Boyd, the oil in the Caddo Pine Island Field was high quality – 35 degrees to 43 degrees API and low sulphur.