Sydney Gas reviews options after merger proposalNovember 2, 2007...

Sydney Gas reviews options after merger proposal
November 2, 2007 - 10:38AM


Sydney Gas is conducting a strategic review after the gas producer was approached by a number of groups seeking a merger.

The junior gas producer said it had received "preliminary proposals from different parties to accelerate the exploration and development of its coal seam gas resources and/or to merge with another group".

Sydney Gas has appointed Babc ock & Brown Australia and PricewaterhouseCoopers Securities to assist the company through the strategic review.

The company said there was "no assurance" that the strategic review would result in a transaction or new development arrangement.

The gas producer said it does not intend to disclose any more information regarding the process until after the review has been completed, which may take "some months".

Sydney Gas has a supply agreement with Australia's largest power retailer, AGL Energy Ltd.

The two groups are joint venture partners in the Camden gas project located 50 kilometres south-west of Sydney, which has been supplying AGL with gas since 2001.

The company's coal seam gas projects are located in the Hunter and Newcastle regions to the north of Sydney.

Sydney Gas shares were unchanged at 39 cents by 10.19am.

AAP