Chaucer Energy Limited

Initial Public Offering

IPO

Offer type

$5.5m

Round size

Key Offer Details

Days left

12 days

Raising Target

$5.5M

Price per share

20 cents

Security Type

Ordinary shares

Letter from the Chairman

Dear Investor,


On behalf of the Board, it is my pleasure to invite you to invest in this initial public offering of Shares in Chaucer Energy Limited (Chaucer Energy or the Company).


Chaucer Energy is an Australian public company that aims to develop a commercial energy project in Chile using gas obtained from applying the process of In Situ Gasification (ISG) to deep domestic coal resources. The Company’s management team and its technology partner Ergo Exergy Technologies Inc (Ergo Exergy), have a long association with ISG (details of which are provided in Section 6 of this Prospectus).


The Company has undertaken a comprehensive review of Chile’s coal basins and, at the date of this Prospectus, has identified three potential project areas in southern Chile that it wishes to evaluate further. We have been granted Exploration Mining Concessions over 4,100 hectares of land near the town of Maullin (the Maullin Project area), and also over two other separate areas in the Magallan Basin – 8,200 hectares at Rio Perez (the Rio Perez Project area) and 6,900 hectares on Isla Riesco (the Isla Riesco Project area). The Company believes that it has acquired the most prospective areas in the country for the application of the ISG process.


Selection of the Company’s project areas has been made on the basis of data from oil and gas wells, nearby drilling data, seismic and gravimetric surveys and from coal outcrop exposures as described in the Independent Geologist’s Report contained in Section 11 of this Prospectus. To date, insufficient drilling has been undertaken to define a JORC compliant coal resource within any of the project areas and further exploration needs to be undertaken to confirm the viability of implementing a commercial ISG project.


The Company proposes to raise a minimum of $4,500,000, and a maximum of $5,500,000 pursuant to this Prospectus to enable it to conduct selective exploration and further evaluate the suitability of the project areas for development. The initial focus will be on the Maullin Project area where, subject to a positive evaluation, the Company intends to develop a staged commercial ISG Power Project. Funds raised under this Prospectus will be used to undertake an exploration program with the objective being to identify a JORC compliant resource on this area, and also to confirm whether a coal deposit might exist on at least one of the Rio Perez Project or Isla Riesco Project areas.


The manner in which the funds raised through this Prospectus will be used, together with indicative project development timeframes are discussed in further detail in Sections 5 and 13.7. Details about the risks associated with the Company’s business plan and making an investment in the Company are contained in Section 7.


It is with great enthusiasm that I commend this Prospectus to you, and invite you to join us as an investor for the exciting future ahead.


Yours faithfully,

Malcolm McAully
Chairperson

Key Points

  • IPO raising $4.5 to $5.5m

  • Proceeds to take Chaucer through to point of well Ignition and first gas flow

  • Focused on creating a domestic energy supply for Chile using ISG technology

  • Granted Concessions over 3 large areas prospective for coal deposits

  • Initial 3MW plant requires minimal approvals

  • Planned to be in revenue in 2022/23

  • Regular milestones for post-listing growth

Key Highlights

  • Australian company with world-leading ISG expertise operating across key coal assets in Chile

  • Utilising InSitu-Gasification (ISG) to provide gas & electricity to regions in urgent need to energy supply

  • Exploration Concessions have been granted for three project locations in Southern Chile.

    • Chosen on the basis of known local coal deposits and past drilling data, existing coal geology & local energy needs

  • Drilling program planned to establish JORC resource on Maullin Project area

  • A fast-to-market and fast-to-revenue project strategy

    • Chilean Government has previous experience of ISG

    • No preliminary trial is planned – 3MW of power generation needs minimal approvals

    • Indicative costing for power development on granted Concessions already undertaken

  • Once coal resource is established, a staged power play is planned to minimise CapEx & risk

    • Creating revenue from power generation in 2022/23

    • Expanding power generation rapidly with modular expansion

    • Initially 3MW, then progressively to commercial scale

  • The Chilean Environment Assessment Service (EEA) has confirmed to the Company that ISG operations are not subject to any ban or moratorium

  • IPO proceeds to enable JORC and preparation for gas production within 24 months

Who is the Company?

The Company is an Australian public company established to pursue the development of commercial ISG facilities. ISG is a process whereby stranded coal deposits, which are too deep for conventional open cut mining methods, can be utilised through the injection and ignition of a pressurised oxidant (such as air or oxygen/steam) to convert the coal to Syngas. Syngas can then be burnt to produce electricity or converted by chemical processing into a number of products including urea and methanol. The Company has identified 3 potential project areas in southern Chile.

The Company (through its subsidiaries) holds Exploration Mining Concessions over the Maullin Project area, the Rio Perez Project area and the Isla Riesco Project area. A JORC resource is yet to be established within any of the project areas and the Company intends to conduct exploration to confirm the viability of implementing a phased commercial ISG Power Project. Subject to identifying a suitable coal deposit, and to satisfactory feasibility studies, relevant approvals and further funding, the Company intends to develop a phased commercial ISG Power Project, initially starting with 3MW of electricity production.

Company Overview

Modern economy: immediate needs

  • Chile’s 19m people enjoy the highest-per capita GDP in South America

  • Electricity demand has doubled since 2000 & is set to more than double again by 2050

  • Chilean Govt. has established a 2050 National Energy Policy

    • The #1 pillar is the quality and security of supply

    • Our projects support the National Energy Policy in multiple ways

  • 2/3rd of Chile’s energy supply is imported

  • Chile has 8th highest electricity price for industry amongst International Energy Agency (IEA) nations.

  • Firewood accounts for roughly 60% of domestic energy production

    • This is an urgent bio-health issue

  • Chilean govt is supportive for projects that add domestic power generation & gas supply

Supplying electricity in Chile can be highly profitable

  • Electricity Prices continue to rise in Chile

    • Amongst highest in OECD

  • We plan to generation 3MW in 2022/23

  • Progressive scale-up to commercial scale through modular expansion

    • Phased development strategy minimises investment risk

Project locations and concessions

Mid-South: MAULLIN – South-west of Puerto Montt

  • Granted Concession of 4,100Ha with prospective coal deposit as initial project

Deep-South: PUNTA ARENAS – Magellan Basin

  • Granted Concession of 8,200Ha (Rio Perez) & 6,900Ha (Isla Riesco) with prospective Concession areas identified for later application

  • Additional prospective Concession areas identified for later application

Areas elected based on:

  • Presence of known local coal deposits

  • Existing drill, seismic & geological data

  • Regional need for gas for electricity and potential chemical manufacture

Board of Directors and Company Secretary

Malcolm McAully – Non-Executive Chairman

Mr McAully has formal qualifications in Accounting and Business Management, with 15 years of Senior Executive Management experience in the superannuation, civil construction and manufacturing industries. He has a comprehensive knowledge in all aspects of corporate finances, including budgeting, cost/benefit analysis and financial forecasting, and is affiliated with the Institute of Company Directors, Institute of Arbitrators and Mediators, and is an Accredited Turn Around Practitioner.

Mr McAully has operated in a diverse range of industry sectors, such as energy generation, human resources, waste management and agribusiness marketing, technology manufacturing, hospitality and recruitment/human resource management. He is an experienced company director and served as Chairman of ISG company Cougar Energy Limited [ASX:CXY] (since renamed Moreton Resources Limited) from 2006 to 2013. He currently serves as Chairman of ASX Listed Company Pure Foods Tasmania Limited [ASX:PFT].

Dr Len Walker – Managing Director

Dr Walker is a graduate of Melbourne and Cambridge Universities in Geotechnical Engineering and Business Administration, followed by a 15-year career in consulting engineering, and subsequent business interests in a number of small developing resource companies. His involvement in ISG began in 1982. He founded Linc Energy Limited (which was ultimately admitted to the [ASX – LNC]) in 1996, and was responsible for development of the first successful Chinchilla ISG test burn which ran from 1999-2002, gasified 35,000 tonnes of coal, was successfully rehabilitated, and served to generate a revival of the technology internationally.

He founded Cougar Energy Limited [ASX:CXY] (since renamed Moreton Resources Limited) in 2006 to continue this work, culminating in ignition in early 2010 of the pilot test at Kingaroy, Queensland. This test was successfully shut down and rehabilitated following the Queensland Government decision in 2010 to restrict development of the company’s project.
Dr Walker has published articles on ISG in peer-reviewed Journals, including a summary of the history of ISG development in Australia. In Chaucer Energy, he has brought together the same group of experts with whom he has been involved in the past, with the goal of developing a commercially successful ISG project in Chile as the basis for expansion of commercial developments internationally.

Stephen Layton – Non-Executive Director

Mr Layton has over 35 years’ experience in Equity Capital Markets in the UK and Australia. Starting as a Jobber (market maker) with BZW on the trading floor of the London Stock Exchange from 1980 to 1986, he became a Member of the London Stock Exchange in 1985.

Since migrating to Australia in 1986 Mr Layton has worked with various stockbroking firms and/or AFSL regulated Corporate Advisory firms. Having raised capital for many ASX-listed companies, he has a depth of knowledge that only comes from a thorough immersion in the industry. Mr Layton has specialized in capital raising services and opportunities, corporate advisory, facilitation of ASX listings and assisting companies to grow. Mr Layton has held both Principal and Director roles in his advisory career and his professional associations include Master Practitioner Member of the Stockbrokers and Financial Advisors Association – MSAFAA. Mr Layton is currently a non-executive director of ASX listed Mithril Resources Limited [ASX:MTH] and Speciality Metals International Limited [ASX:SEI].

Adrien Wing – Company Secretary

Mr Wing is a certified practicing accountant. He practiced in the audit and corporate advisory divisions of a chartered accounting firm before he commenced working with a number of public companies listed on the ASX as a corporate / accounting consultant and company secretary.

Mr Wing is currently a non-executive director and company secretary of Red Sky Energy Limited [ASX:ROG], High Grade Metals Limited [ASX:HGM] and Mithril Resources Limited [ASX: MTH] as well as company secretary of Rhythm Biosciences Limited [ASX:RHY], New Age Exploration Limited [ASX:NAE], Kairos Minerals [ASX:KAI] and Nova Minerals Limited [ASX:NVA]. Mr Wing has a wealth of ASX and corporate experience whereby he provides strong support to his Board of Directors and other key management as well as providing support to many of the committees/sub-committees of these entities that fall within the corporate governance framework.

Important Information

 

This presentation is not part of the Prospectus.
Applicants should read the Prospectus in its entirety before deciding to apply for Shares. The Prospectus does not take into account your individual investment objectives, financial situation or any of your particular needs. You should seek independent legal, financial and taxation advice before making a decision whether to invest in the Company.

An investment in this Company carries risks. An outline of some of the risks that apply to an investment in the Company is set out in the relevant section of the Prospectus. Applicants are urged to consider this Section of the Prospectus carefully before deciding to apply for Securities.

No person is authorised to give any information or make any representation in connection with the Offer which is not contained in the Prospectus. Any information or representation not so contained or taken to be contained may not be relied on as having been authorised by the Company or any other person in connection with the Offer.

Contact Maqro

[email protected]

Send an email

64 Clarence Street Sydney

Come and visit

(02) 9054 4593

Give us a call