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Golden Gate In Pre Open Pending Capital Raising Announcement

Golden Gate in pre open pending capital raising announcement Friday, June 15, 2012 by Bevis Yeo Golden Gate Petroleum (ASX: GGP) has been granted a trading halt pending a capital raising announcement.

The company had recently picked up a 10% stake in an Eagle Ford Shale project in Texas and flagged that it would have to spend about US$3.4 million to meet its share of project costs over the next year.

The 3400 acre (13.76 square kilometre) project has 42 potential drilling locations with total resource potential of 15 million barrels of oil equivalent.

Well costs are estimated at about US$7.5 million (A$7.3 million) with each well expected to produce between 600 to 1200 barrels of oil equivalent per day. Ultimate recoveries are 362,000 to 500,000 barrels of oil equivalent.

Golden Gate had also in May confirmed the presence of gas and condensate at the Sugar Valley-1 well in the Bowtie West project, Texas.

The operator expects to carry out a 2 or 3 well program to produce the in-place resource potential of 30 billion cubic feet of gas and about 540,000 barrels of oil in the primary target in this prospect.

Shares in Golden Gate will remain in pre open until the earlier of the release of an announcement to the market or the commencement of normal trading on Tuesday June 19.