The issue, of two shares at 5c for every five shares held, will be of a maximum 21.9 million shares.

Hydrogen has been conducting trials of its Ecogas generators since August 2005, with the money raised used to fund ongoing testing of a more efficient model.

Ecogas generators produce hydrogen and oxygen mixed gases on site, with low operating pressures and no need for storage tanks or cylinders. It is designed to offer industry an alternative industry fuel gas, with no greenhouse gas emissions.

The company is chaired by Peter Kailis, with Richard Ranshaw serving as managing director and company secretary. They are currently seeking a third director following the resignation of Dong ke Zhang in August.

Entitlement forms will be distributed to shareholders on October 4, with the offer to close on October 25.