BUSINESS - COMPANIES
| 2013-07-26Tower Resources to raise N$136 million for oil drilling
TOWER Resources plc, which is listed on the Alternative Investment Market AIM part of the London Stock Exchange, plans to raise US$13,9 million (about N$136 million) for oil drilling in Namibia. The drilling is expected to start in February 2014.
Tower said on Thursday that the proceeds of the placing and the open offer will be used to fund the company’s share of costs associated with the Welwitschia-1 well in Namibia, the cash consideration payable in respect of the acquisition of Wilton Petroleum Limited for general working capital to enhance the company’s ability to pursue its new ventures strategy.
Tower said it has has conditionally placed 802,343,266 new ordinary shares at a price of 1,125 pence per share to raise £9 million (US$13,9 million) by means of a placing by Peel Hunt LLP and GMP Securities Europe LLP. It is expected that admission of the Placing Shares will become effective and that dealings will commence in the placing shares on 30 July 2013.
In addition, in order to provide shareholders with an opportunity to participate in the fundraising, the company is launching a two for nine open offer of up to 360,811,606 new ordinary shares at a price of 1,125 pence per share to raise up to an additional £4,1 million (US$6,2 million).
The company said it intends to farm out a 10% interest in its Namibian licence 0010 (current interest 30%) to fund exposure to 2014 drilling costs.
“At this crucial time in the company’s development it is important that we have the means to fund our share of 2013 costs for the Welwitschia-1 well and to have the flexibility to enter further new ventures. We are grateful to existing and new investors for their support, and are pleased that the open offer enables all shareholders to participate in this fundraising. Our high-potential 2014 drilling activity and new venture ambitions mean that these are truly exciting times for Tower,” said Graeme Thomson, Chief Executive Officer of Tower Resources.
Tower’s plans are in the wake of failed bids by Chariot Oil and HRT to find oil offshore Namibia.
Last week, Brazilian operator HRT said the second well it had drilled, the Murombe-1had produced no oil. The dry hole followed the discovery earlier this year of non-commercial volumes of oil with HRT’s first well. HRT still plans to drill a third well in the northern Orange Basin.
HRT has also suffered setbacks in its exploration efforts in Brazil’s Solimões Basin and in Namibia, driving down its shares by 58% this year alone. It had been hoping to make a large discovery off shore Namibia.
Tower said on Thursday that the proceeds of the placing and the open offer will be used to fund the company’s share of costs associated with the Welwitschia-1 well in Namibia, the cash consideration payable in respect of the acquisition of Wilton Petroleum Limited for general working capital to enhance the company’s ability to pursue its new ventures strategy.
Tower said it has has conditionally placed 802,343,266 new ordinary shares at a price of 1,125 pence per share to raise £9 million (US$13,9 million) by means of a placing by Peel Hunt LLP and GMP Securities Europe LLP. It is expected that admission of the Placing Shares will become effective and that dealings will commence in the placing shares on 30 July 2013.
In addition, in order to provide shareholders with an opportunity to participate in the fundraising, the company is launching a two for nine open offer of up to 360,811,606 new ordinary shares at a price of 1,125 pence per share to raise up to an additional £4,1 million (US$6,2 million).
The company said it intends to farm out a 10% interest in its Namibian licence 0010 (current interest 30%) to fund exposure to 2014 drilling costs.
“At this crucial time in the company’s development it is important that we have the means to fund our share of 2013 costs for the Welwitschia-1 well and to have the flexibility to enter further new ventures. We are grateful to existing and new investors for their support, and are pleased that the open offer enables all shareholders to participate in this fundraising. Our high-potential 2014 drilling activity and new venture ambitions mean that these are truly exciting times for Tower,” said Graeme Thomson, Chief Executive Officer of Tower Resources.
Tower’s plans are in the wake of failed bids by Chariot Oil and HRT to find oil offshore Namibia.
Last week, Brazilian operator HRT said the second well it had drilled, the Murombe-1had produced no oil. The dry hole followed the discovery earlier this year of non-commercial volumes of oil with HRT’s first well. HRT still plans to drill a third well in the northern Orange Basin.
HRT has also suffered setbacks in its exploration efforts in Brazil’s Solimões Basin and in Namibia, driving down its shares by 58% this year alone. It had been hoping to make a large discovery off shore Namibia.
