Great Eastern Energy Corp (GEECL), the country's first Coal Bed Methane (CBM) gas producing company, has received final approval from the capital markets regulator, Securities and Exchange Board of India (Sebi), for its proposed public offering, especially, at a time when the market scaled all time high levels on the back of growing appetite for local shares from the foreign investors.
"We got Sebi's final observation on the draft red herring prospectus on Wednesday. Though we wouldn't try to time the market, the current sentiment appears to be positive for the issue," chairman and chief executive officer YK Modi told dna.
Even as the company is working on a CBM block in Raniganj block and developing a field in Tamil Nadu, Modi is eyeing acquisition of new CBM blocks when the government comes up with auction.
"The government would be offering CBM blocks, totaling about 11, which it had earlier taken back. We would be eyeing those blocks which are viable," he said.
The IPO would constitute fresh issue of 78 lakh shares and offer for sale of up to 4 lakh shares by promoter entity YKM Holdings International owned by Modi's family.
The issue offers Indian investors – GEECL - already listed at London Stock Exchange - an opportunity to invest in the CBM sector for the first time.
GEECL is already producing CBM gas from Raniganj (South) block in West Bengal having an estimated original gas-in-place of 2.40 trillion cubic feet while it has recently been awarded a 25% participating interest in an adjacent block, Raniganj (North) by ONGC.
These apart, it is developing Mannargudi block in Tamil Nadu.
Work on the Tamil Nadu block would be taken up after the state government gives its final clearance to operate, Modi said.
During the nine-month period till December, GEECL earned revenue of Rs 150 crore, up 21% on-year while net profit stood at Rs 62.3 crore, a growth of 81%.
The Raniganj field has been producing 21.31 million standard cubic feet per day in September while sale in November was about 10.10 31mmscfd, according to latest data announced by GEECL.
A total of 156 wells have been drilled in the block till date of which 148 wells are already operational.