DART EXPANDS OFFSHORE

DART EXPANDS OFFSHORE

DART Energy Limited (DTE) is expanding its international asset base after acquiring a 10 per cent stake in a Scottish coal bed methane (CBM) company today for $7.69 million.

The Arrow Energy spin-off’s CEO Simon Potter (pictured), says the company could boost its stake in Composite Energy to 20 per cent in January and if all goes to plan it could take full ownership mid-2011.

“It’s consistent with our method we had with Arrow and now Dart to follow, with low cost entry so that we can understand the business and the market before we aim for a full equity position,” Potter told Brisbane Business News from his Singapore office.

“The energy situation in Europe is showing strong demand and carbon energy success, which obviously includes gas, and with the expected increases in price against demand, it makes great sense for us to be there."

If Brisbane-based Dart decides to acquire Composite Energy by mid-2011, the total cost of the additional 80 per cent ownership would be around $61.5 million.

At the time when Arrow Energy was negotiating its sale to Shell and the spin-off of international assets and local holdings in an IPO as Dart, concerns were raised about the cash levels needed to carry out projects.

“Obviously at the time of the sale when we were talking about the cash required for the next two years, we factored in this sort of activity – when we talked about the $100 million needed to 2011 we already assumed exploration success and business development success, and this constitutes part of that business development,” says Potter.

“Composite is an established European CBM business with an existing portfolio of assets, an in-place management team, a strong pipeline of opportunities and a significant NSAI certified resource position.

“The investment therefore provides Dart with a compelling entry platform into the European CBM and shale industry, albeit in a staged way that does not detract focus from our existing current activities.

Privately-owned company Composite holds interests in 15 CBM blocks in the UK, two blocks in Poland and a pipeline of shale opportunities in continental Europe.

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