Gas firm raises cash for Iraq venture

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The Independent Online

A little company with a new contract to produce gas in southern Iraq is planning to raise £25m with a flotation on AIM.

Gulfsands Petroleum has signed a deal with the Ministry of Oil in Baghdad, in consultation with the US government, which will allow it to collect gas that is a by-product of oil wells in Misan, one of the poorest provinces in Iraq. The gas is currently flared off.

Gulfsands says the project, which will help generate electricity, will be the first large infrastructure project undertaken by private international investment since the toppling of Saddam Hussein.

"We have briefed representatives of the Iraqi government, the US government and various international financing institutions about the Misan Gas Project and its beneficial impact for the Iraqi people, environment and economy," said John Dorrier, chairman and chief executive of Gulfsands.

The company is raising £25m through a placing by Seymour Pierce, using the cash to fund design work on the gas-gathering project and for additional oil and gas exploration work in the Middle East and the US. It also has interests in the Gulf of Mexico. Syria Gulfsands was founded in 1997 by Mr Dorrier, who had spent the previous decade at BHP's petroleum division.