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LONDON (Alliance News) - Europa Oil and Gas (Holdings) PLC shares plummeted on Monday after it said it has raised GBP1.4 million from a firm placing and said it intends to raise a further GBP2 million by conducting an open offer.
Europa shares tumbled 20% to 6.30 pence per share on Monday morning.
The company said it placed 20 million new shares under a firm placing and another 2.6 million new shares under a conditional placing, both at 6.0 pence per share to raise the GBP1.4 million, and said it will raise up to a further GBP2.0 million by issuing a further 34.1 million new shares at the same issue price.
Directors of the company have agreed to subscribe to 449,332 new shares in total under the open offer.
The proceeds from the placings and open offer will be used to fund the expected start-up costs of production at the Wressle well. That well is part of a joint venture between the company and fellow listed Egdon Resources PLC and Union Jack Oil PLC.
The Wressle well is located on the PEDL180 license in Lincolnshire and the company reported a successful flow test from the well back in February.
The proceeds will also be used to fund any seismic acquisition activities that may be needed as part of the 14th UK onshore licensing round that it intends to participate in and to fund Europa's 15% share of general and administrative costs on its Irish Atlantic Margin licences in the Porcupine Basin. That is part of its joint venture with Kosmos Energy Ltd.
"We are seeking to grow our licence holdings in onshore UK and offshore Ireland and the funds raised will enable Europa to undertake new exploration investment as well as funding work on existing projects such as the Wressle oil and gas discovery in PEDL 180," said Europa.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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