Restructuring for Growth
Brisbane, Sep 10, 2024 AEST (ABN Newswire) - Following the recent successful re-capitalisation, State Gas Limited (
ASX:GAS) (STGSF:OTCMKTS) is in the enviable position to be able to plan for the reserve certification necessary to underwrite a pipeline connection of its gas exploration and development projects to the gas-short domestic market. The Company is also well placed to further develop the market for its innovative high density natural gas (HDNG) technology.
The Company aims to position the sale of HDNG to replace diesel in coal trucks in Queensland with the near-term goal of enabling the Company to become cash positive. Given this milestone, the Board has decided to structure the Company's management to optimise the exciting opportunities ahead. Doug McAlpine, who has been the Chief Executive Officer for the last two years, will now join the board as Managing Director.
The Board believes that Mr McAlpine's appointment to the role of Managing Director will allow more coordinated and rapid execution of the Company's Strategy and more effectively leverage the broader capability of the Company's Directors and Management Team. Mr McAlpine joined State Gas as Chief Executive Officer in November 2022 and since that time has worked closely with the Board to reposition the Company. He has played an important role in progressing exploration and appraisal activity (including securing a government grant of $5.5M for two new exploration wells) at Rolleston West (ATP 2062) and has laid the foundations for an Alternative Fuels Business through leading the delivery and commissioning of the Company's HDNG production facility at Rolleston West.
To further support the rapid execution of the Company's Alternative Fuels strategy, State Gas is also pleased to appoint Mr Daniel Marcus to the role of Executive General Manager - Alternative Fuels. Mr Marcus is an experienced mining industry executive having held a variety of senior commercial and operational roles over his thirty-year career. He is a mechanical engineer by training and has deep experience in the day-to-day aspects of running efficient mining operations, in particular, the effective management of mining truck fleets. Mr Marcus' mining industry experience will be invaluable in developing and growing the Company's alternative fuels business that centres on the efficacy of HDNG as an alternative fuel source to replace diesel in the mining sector.
As a further demonstration of confidence in the expanded management team, Mr Richard Cottee is stepping down from his position as role as Executive Chairman but will remain as Non-Executive Chairman of the Company.
Richard Cottee said: "Having guided the company through difficult capital markets to being on the cusp of being cash positive, now is the right time for the Company to revert to the more traditional structure with an independent Chairman. This decision underlines my confidence in the Company's Executive Team led by Doug McAlpine and my optimism for State Gas' future".
Managing Director, Mr Doug McAlpine, said: "It has been my privilege to work with the Directors and Management Team over the last two years, having now established solid foundations for progressing the Rolleston West Project toward development, but also creating first mover advantage as an Alternative Fuelsprovider using HDNG. I am proud to have the opportunity to work with the Company's expanded leadership team as we deliver on the Company's vision and demonstrate increasing value for shareholders."
The key terms of Mr Doug McAlpine's services contract are included in Appendix 1*. Mr McAlpine's compensation package is structured to align his total reward with share price growth and the delivery of key operational and commercial milestones which will create long term value of the Company and its stakeholders.
*To view Appendix 1, please visit:
https://abnnewswire.net/lnk/JZ4W0R4V
About State Gas Limited
State Gas Limited (ASX:GAS) is a Queensland-based developer of the Reid's Dome gas field, originally discovered during drilling in 1955, located in the Bowen Basin in Central Queensland. State Gas is 100%-owner of the Reid's Dome Gas Project (PL-231) a CSG and conventional gas play, which is well-located 30 kilometres southwest of Rolleston, approximately 50 kilometres from the Queensland Gas Pipeline and interconnected east coast gas network.
Permian coal measures within the Reid's Dome Beds are extensive across the entire permit but the area had not been explored for coal seam gas prior to State Gas' ownership. In late 2018 State Gas drilled the first coal seam gas well in the region (Nyanda-4) into the Reid's Dome Beds and established the potential for a significant coal seam gas project in PL 231. The extension of the coal measures into the northern and central areas of the permit was confirmed in late 2019 by the Company's drilling of Aldinga East-1A (12 km north) and Serocold-1 (6 km to the north of Nyanda-4).
State Gas is also the 100% holder Authority to Prospect 2062 ("Rolleston-West"), a 1,414 km2 permit (eight times larger than PL 231) that is contiguous with the Reid's Dome Gas Project. Rolleston-West contains highly prospective targets for both coal seam gas (CSG) and known conventional gas within the permit area. It is not restricted by domestic gas reservation requirements.
The contiguous areas (Reid's Dome and Rolleston-West), under sole ownership by State Gas, enable integration of activities and a unified super-gasfield development, providing economies of scale, efficient operations, and optionality in marketing.
State Gas is implementing its strategic plan to bring gas to market from Reid's Dome and Rolleston-West to meet near term forecast shortfalls in the east coast domestic gas market. The strategy involves progressing a phased appraisal program in parallel with permitting for an export pipeline and development facilities to facilitate the fastest possible delivery of gas to market. State Gas' current focus has been to confirm the producibility of the gas through production testing of the wells.
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