September 17, 2008

Major Gas Find in Southland

TINY exploration company L&M Petroleum has found a much bigger than expected seam of coal gas in Southland -- a find that could be worth $500 million and rival the Kupe gasfield in Taranaki.

But investors seemed unimpressed, with L&M shares dipping 1 cent to close at 19c yesterday.

The energy-exploration company discovered the coal-seam gas near Ohai at the weekend. Chief executive John Bay said it was good news, "without a doubt", though the company had to do more tests and drill more wells before it could confirm this was a commercially viable find.

"The first seam has come in 50 per cent thicker and, according to the field geologist, the cores were 'fizzing with gas'," he said.

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