There haven’t been many good news stories out of the energy shortage on Australia’s east coast, but for Cooper Energy (ASX:COE) the crisis which has driven gas prices sharply higher could soon be reflected in a higher share price.

A corporate minnow compared with better-known oil and gas companies, Cooper has been a low-key star over the past three years as investors have slowly recognised that it’s in the right place at the right time, selling a commodity in strong demand.

From a share-price low of just 12c in early 2016 Cooper last week traded up to 58c, a few cents short of a six-year high, which is a better performance than most other oil and gas stocks exposed to a weak oil price.

The difference with Cooper is that it is operating in a “seller’s market” as domestic buyers clamour for the gas it produces from small projects in the Otway Basin off Victoria’s west coast and the company’s namesake Cooper Basin of South Australia.

But what’s caught the eye of the market is something much bigger, Cooper’s company-maker, the Sole gasfield off Victoria’s Gippsland coast, close to the original Bass Strait oil and gas fields.

Sole is not in the same league as the giant fields developed by BHP (ASX:BHP) and ExxonMobil in Bass Strait but it will be a handsome profit earner for Cooper and easily its biggest project, so far.

Development delays, mainly in the onshore gas processing phase of the Sole project, have forced Cooper to put back the start-up date for first gas sales and jaded the enthusiasm for the stock.

That should change in the next few weeks with the Orbost gas plant ready for commissioning causing a number of stockbroking firms and investment banks to dust off their Cooper research.

Morgans rated Cooper a buy in its latest research note, which followed what was a reasonable profit for the year to June 30 with underlying earnings up 36 per cent to $13.3m from a 12 per cent increase in sales to $75.5m.

Sole did not feature in that result, but the project’s impact will certainly be felt in the current financial year, with Morgans tipping a 415 per cent profit increase to $67m from a 230 per cent increase in sales to $248m – with the lion’s share of the extra sales and profits flowing from Sole.

“We are entering a critical period as we near the finish line at Cooper’s Sole gas project, with commissioning of the Orbost gas plant approaching,” Morgans said.

“Upstream (offshore) work has been completed at Sole with APA (the onshore plant operator) advancing final construction and commissioning.

“Successful start-up and early performance of the gas plant are the remaining key hurdles.”

Macquarie also has Cooper on a buy list with the processing plant expected to be commissioned in September with firm gas sales being booked in the December quarter.

“The commissioning of the Sole project is set to transform the earnings outlook for Cooper,” Macquarie said.

Credit Suisse, which has a hold tip on the stock, likes the boost which will come from the Sole start-up as well as a number of other “near-term catalysts” such as an increase in exploration and drilling activity.

“We see further upside from the Sole start-up and debottlenecking, tax optimisation, higher (gas) prices and exploration, balanced by project execution and exploration risk,” Credit Suisse said.

The potential for a production expansion in the Otway Basin could be another important factor in the re-rating of Cooper with an offshore drilling campaign underway at the Annie and Elanora targets.

A busy drilling program in the onshore Cooper Basin could also boost interest in the stock.

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