Eastern Gas Targets $5.5M to Prove Queensland Gas Projects’ Commercial Viability

Eastern Gas IPO – A Strategic Spin-Out from Pure One

Eastern Gas Corporation Limited, recently incorporated as a wholly owned subsidiary of Pure One Corporation Limited (ASX – PH2), has taken a significant step towards becoming a standalone ASX-listed entity. The company lodged a Replacement Prospectus on 12 December 2025, aiming to raise up to $5.5 million through the issue of 27.5 million shares at $0.20 each. This capital raise is designed to fund exploration and appraisal activities on two key Queensland gas projects – ATP 2051 (Venus Project) and ATP 927 (Windorah Project).

Substantial Contingent Resources and Strategic Location

The Venus Project, situated in the Surat Basin, holds 130.3 petajoules (PJ) of 2C Contingent Resources within the Walloon Coal Seam Gas field. Meanwhile, the Windorah Project in the Cooper Basin contains 330.3 billion standard cubic feet (Bscf) of 2C Contingent Resources in a Basin Centred Gas play. Both projects benefit from proximity to existing gas infrastructure and established production areas, positioning Eastern Gas to potentially supply the tightening East Coast gas market.

Technical Pathway – Horizontal Drilling and Fracture Stimulation

Eastern Gas plans to demonstrate commercial viability primarily through horizontal drilling and flow testing in the Venus Project, targeting the thick Upper Macalister coal seams. This approach follows previous vertical well tests that produced gas but failed to achieve sustainable commercial flow rates. For the Windorah Project, the company intends to apply advanced fracture stimulation techniques to improve gas flow in the Queenscliff-1 well, building on lessons learned from earlier appraisal wells.

Independent Validation and Risk Considerations

The company’s technical strategy is supported by an Independent Technical Report from Molyneux Advisors Pty Ltd, which validates the contingent resource estimates and outlines the development challenges and opportunities. The report classifies both projects’ resources as Contingent Resources – Development on Hold, reflecting the need for further appraisal to confirm commercial production potential.

Key risks highlighted include the pending renewal of ATP 2051, technical uncertainties in achieving commercial gas flow rates, and the requirement for additional capital beyond the current raise to progress to production. Governance considerations arise from Pure One’s potential to retain majority ownership post-listing, controlling approximately 69.44% of the issued capital.

Financial and Corporate Governance Framework

Eastern Gas has presented a pro-forma financial position showing a conservative asset valuation of $13.5 million for the projects, with the capital raise intended to fund a two-year exploration and appraisal program. The company has appointed Securities Vault as Lead Manager and engaged reputable advisors including HopgoodGanim Lawyers and A D Danieli Audit Pty Ltd to support the IPO process. Directors and key management bring extensive experience in oil and gas exploration and corporate governance.

The offer includes priority allocation to existing Pure One shareholders and is conditional on minimum subscription and ASX approval. No dividends are expected in the near term as funds will be directed towards project development.

Market Context and Outlook

The IPO comes at a time when the Australian Competition & Consumer Commission has identified a deteriorating supply outlook for East Coast gas, underscoring the strategic importance of new gas developments. Eastern Gas aims to leverage its substantial resource base and technical expertise to contribute to easing supply constraints, while delivering value to shareholders through successful project maturation.