Panax Geothermal raises US$4.2 million in share purchase plan

Alexander Richter 15 Dec 2009

Panax Geothermal successfully closes share purchase plan with applications totaling about AU$4.65 million (US$4.2 million).

According to a recent release, “Panax Geothermal (ASX: PAX) has announced its Share Purchase Plan has successfully closed, with applications totaling about AU$4.65 million (US$4.2 million).

The applications under the oversubscribed SPP amounted to approximately $0.40 million or 10% over the maximum level set by the Company under the SPP rules.

The funds raised from the SPP will be used to fund the development of the Salamander-1 production well for the Penola Geothermal Project in the south east of South Australia, as well as for other Panax projects in Australia and internationally.

The merit of the Penola Project is verified by the occurrence of an independently assessed “Measured Geothermal Resource” estimated at 11,000 PJ of stored heat, potentially sufficient for generating hundreds of MW’s of power.

The Penola Measured Geothermal Resource is one of only three in occurrence in Australia, two of which are owned by Panax.

The Salamander-1 well is a production well designed with the aim to convert part of the “Geothermal Resources” of the Penola Project into Geothermal Reserves, which in turn will form the basis for the development of a commercial, grid connected Demonstration Plant, a first for Australia.

During the course of the past 8 months, Panax has been successful in gaining access to approximately $24.3 million in new and available funding, including a $7 million grant under Round 1 of the Australian Government’s Department of Resources, Energy, and Tourism’s Geothermal Drilling Program.

Over the same time period, Panax has grown its shareholder base from approximately 950 shareholders, to approximately 2,250 shareholders at the time of writing, an increase of approximately 140%, including 15 new institutional holders who have joined the register.”

Source: release via Proactive Investors