Panax moves forward with Osiris Energy acquisition Monday, 3...

Panax moves forward with Osiris Energy acquisition

Monday, 3 November 2008

PANAX Geothermal says its $14.8 million acquisition of unlisted Melbourne-based geothermal company Osiris Energy is now unconditional, and is expected to be completed in December.

The acquisition, announced in early September, was subject to Panax raising a minimum of $20 million in new working capital. However, due to the current market conditions, the major Osiris shareholders agreed to waive the condition.

Panax said it still intends to pursue current capital raising initiatives including completing a share purchase plan for all current shareholders.

The company has about $8 million cash to fund its activities.

The acquisition is expected to be completed in December, subject to approval from Panax shareholders.

Panax said the deal would accelerate development of the Limestone Coast project because of high-quality of data in the Osiris acreage, which has had 20 petroleum exploration wells along with 2D and 3D seismic surveys.

“It will enable us to drill a deep appraisal well production well and to undertake reservoir testing without being overly dependent on government grants or on commercially unattractive joint venture arrangements,” managing director Bertus de Graaf said last month.

“The completion of the Osiris transaction will lift Panax as a geothermal company to a new level and provide Panax with the necessary funding to secure and advance geothermal projects both in Australia and internationally,” he added.

Melbourne-based Osiris holds the Penola Trough project in GEL 223 of the Otway Basin, directly adjacent to Panax’s Limestone Coast project, and also holds three geothermal exploration licences in the Cooper Basin as well as an application for a licence in northern New South Wales.