Perth, Feb 2, 2006 AEST (ABN Newswire) - One of Australia's early movers into the lucrative US shale gas market, Alto Energy (ASX: AOI) today announced it had completed its merger with Lach Drummond Resources Limited (ASX: LDR) and will begin trading today on the Australian Stock Exchange under the code AOI.
Alto Energy remains one of the only Australian companies in the US Appalachian Basin with approximately 70,000 gross acres over four main project areas across Kentucky, Tennessee and West Virginia.
Alto Managing Director Mr Greg Channon said that the merger with LDR had been overwhelmingly supported by shareholders of both companies.
LDR undertook an off-market script takeover bid for Alto shares and options late last year by offering 13 LDR shares for every one Alto share. Prior to re-listing, the shares were consolidated at 1:8.
"Shareholders have widely supported the strategy of building a substantial, US-focused business with a significant foothold in a historically productive gas region. Importantly, there is infrastructure at the doorstep so costs are low."
Alto also announced the drilling and completion of 3 wells in the Little Sandy Project in Kentucky, where Alto is being carried through the drilling expenditure by it's partner Norwest Energy (ASX: NWE). Further drilling campaigns in Home Run and Cornstalk are expected in coming weeks.
Mr Channon said that while Alto's corporate headquarters would remain in Perth, Western Australia, the company's US-based operations team was critical in its bid to develop existing assets and identify further and emerging opportunities in the region.
"Alto will continue to target both conventional and unconventional gas plays, such as our Home Run project. We have an aggressive drilling program for the first half of 2006 with a total 26 wells to be drilled across Little Sandy, Home Run, Bug Run and Cornstalk."
Alto also announced its new board with Tony Grist, who acquired and recapitalized LDR in 2005, as Chairman. Fellow directors including Alto founder Charles Morgan as non-executive director and Andrew Dimsey, Alto Business Development Director, join Mr Channon.
"The new board and management team, including US Country Manager Ray Prudnick Jr, boasts strong credentials in US and Australian oil and gas corporate and operational expertise."
"Alto has built a large and strong position in the productive Appalachian Basin, a team of US and Australian experts and an aggressive drilling campaign that is fully funded. The building blocks are in place to create value for shareholders. It's just the beginning," Mr Channon said.
Contact
Greg Channon
Managing Director
Tel +61 (0) 8 6263 0460
Email: greg.channon@altoenergy.com.au
Andrew Dimsey
Director Business Development
Tel + 61 (0) 417550369
Email: andrew.dimsey@altoenergy.com.au
Web: www.altoenergy.com.au
Purple Communications
Level 3, 28 Kings Park Road,
WEST PERTH WA 6005
Ph: 08 9485 1254
Fax: 08 6263 0455
purple@purplecom.com.au
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