Nautical Petroleum Raises Funding for Exploration Program
Nautical Petroleum has completed a placing of 97,585,371 new ordinary shares of 1 pence each conditional, inter alia, on Admission.
The shares were placed at a price of 10.25p per share to raise a total of £10 million before expenses. In addition, the Company is to issue 14,637,800 warrants to subscribe for new Ordinary Shares at 20p during the next four years. The Company has the right to require warrant holders to exercise their warrants should the closing price of the Company's ordinary shares remain above 40p for 90 consecutive trading days.
Since admission to AIM in April 2005, Nautical has successfully completed several acquisitions and selectively secured further UKCS licenses adding considerable value to its asset base. As an independent first mover, the Company has secured a pre-eminent position in heavy oil assets focused on the East Shetland platform. In the process the independently verified net 2P recoverable reserves have increased by over 60% to 64.9 mmbbl.
The proceeds of the Placing will fund Nautical's development and appraisal drilling programs for:
- Mariner - (North Sea Block 9/11a - Gross 2P recoverable reserves 84 mmbbl - Nautical share 26.67%)
- Kraken - (North Sea Block 9/2b - Gross 2P recoverable reserves 53 mmbbl - Nautical share 75%)
- Grenade (France onshore - Gross 2P recoverable reserves 12.6 mmbl - Nautical share 22%)
Proceeds will also be applied to progressing farm-out arrangements on Nautical's extended license portfolio, with an early focus on drilling on the Selkie (8/25a) and Mermaid (9/11c) prospects.
Nautical is actively evaluating several drilling rig options to meet the 2006 and 2007 work program requirements across its extended asset portfolio.
Commenting on the private placement of shares, Steve Jenkins, Chief Executive Officer of Nautical said:
"We are delighted to announce that the Company has raised a further £10 million. The funds raised will be used to support the Company's appraisal and development program for 2006 targeting first oil in second half 2007. We also anticipate a substantial increase in activity in 2006 associated with a program of farm-out arrangements on newly acquired assets."
The Company was advised by Simmons & Company International Limited as corporate finance advisers and Bridgewell Securities Limited, the Company's brokers.
Colin Welsh, Chief Executive of Simmons said: "After successfully arranging Nautical's interim £8 million financing in June this year, we are pleased to have assisted in securing this £10 million financing which is intended to take them through to production on their key assets. Simmons regards Nautical as one of the leading emerging independents in the North Sea and we look forward to a continuing relationship with the company."
The new Ordinary Shares are expected to be admitted to the London AIM exchange on January 3, 2006.