The Hindu Business Line : Gujarat NRE plans rights issue

To part finance the cost of acquisition, future development and exploration of oil and gas blocks it acquired in the Canning Basin, Western Australia, through its wholly-owned subsidiary NRE Resources Pty Ltd, Gujarat NRE Mineral Resources Ltd (GNMRL) is going in for a rights issue.

The cost of the project is Rs 40 crore, to be wholly financed by issue of equity shares of GNMRL on rights basis to the existing shareholders of the company, its Vice-Chairman and Managing Director, Mr Arun Kumar Jagatramka, told reporters here on Wednesday.

He said proceeds from the proposed rights issue will be utilised for the acquisition and development of the oil and gas foray, acquired by the company's Australian subsidiary from Rey Resources Ltd, and also for other future prospects and similar acquisitions.

Accordingly, the company would issue up to a maximum of two million equity shares. Rights entitlement will be 5,000 equity shares for every shareholder as on the record date of October 27, 2006. The issue price per equity share of Re 1 each will be at a premium of Re 1 per share.

After the issue, the outstanding equity shares will be 59,98,46,000. The applicant will have to make 100 per cent payment on application. The minimum application will be for 5,000 equity shares, thereafter in multiples of 1,000 equity shares.

Mr Jagatramka said early bird incentives till November 21 will be five paise per share and application amount of Rs 1.95 per share.

The Gujarat NRE Coke Group, the largest manufacturer of low ash metallurgical coke in the country, with extensive coal mining interests in Australia, has gained access to a virgin block of 10,640 square kms for oil and gas exploration in Western Australia and its prospecting work is expected to start very soon.

Considering the seismographic and other geo-physical data, the areas seems a very prospective region for a strike and the Group is "very optimistic" about the new move. "The past drilling histories are very positive in the region," said Mr Jagatramka.

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