Real Energy (ASX: RLE)
As the East Coast gas shortfall continues to drive up gas prices, with forecasters predicting heavy increases from current levels, one company is looking to commercialise a gas resource that could help mitigate domestic shortages.
Real Energy (ASX: RLE) is focused on exploration and development of oil and gas acreage in the Cooper-Eromanga Basins in southwest Queensland — Australia’s most successful onshore region for oil and gas production.
RLE has discovered a large gas resource and is now ready to bring its Windorah Gas Project into production to meet the shortfall head on.
A recent non-binding Memorandum of Understanding with Santos Limited, will go a long way to helping it achieve this aim, as it would allow raw gas from Windorah to be processed into sales gas, which can then be supplied to the east Australian gas market.
RLE is well-funded with $6 million cash in hand and currently possesses 13.76 tcf estimated total mean gas in place, which means there is multi-well development potential here.
RLE also represents the chance for investors to take a calculated risk on a company with a good chance of striking a multi trillion-cubic-feet gas resource onshore Australia.
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It seems all macro factors are falling into place for RLE: the company is well funded and is operating in a highly prolific area at a time when gas shortages require real solutions.
Furthermore, its non-binding MoU with industry giant Santos could help supply the east Australian gas market and go a long way to helping this $15 million capped company increase its value.