The Board of Jupiter Energy Limited is pleased to advise shareholders that it has completed a placement of $A2.25m (before costs) to largely UK based institutions as the Company begins to broaden its shareholder base to include overseas fund managers. The placement of 50 million shares at $A0.045 (2.54p) per share was organised through UK brokers Astaire Securities and Westhouse Securities as well as Perth based Indian Ocean Capital Pty Ltd.
Of the total placement, JPR Directors have agreed to subscribe for up to 3 million shares. Shares will only be allotted to Directors once shareholder approval has been received at a General Meeting that will be held in March 2010.
There is little doubt that investment in Central Asia, and in particular Kazakhstan, by UK and European funds is significant with many funds having an active investment strategy in the region. For these reasons, JPR has been working on developing relationships with a number of UK fund managers wanting to invest in a company that offers near term oil production in Kazakhstan.
The amount raised via the placement has been limited to $A2.25m because the JPR Board believes that this level of funding is sufficient to bring each of NWZ 2 and J-50 wells independently into long term production with a Trial Production Licence. As shareholders may be aware, the Trial Production Licence process is reasonably detailed. Each well will be production tested for a maximum allowable period of 90 days during which time, JPR will apply to the relevant Kazakhstan authorities for a Trial Production License and also install permanent production facilities at the wellsite. Each Trial Production License application will include JPR’s development and production strategy for that well.
Oil production during the 90 day production test may be sold into the Kazakhstan domestic oil market however, after the Trial Production licence has been obtained for a well, the Company will then be in a position to sell produced oil into both the Export and Domestic markets. Internal cashflow budgets are currently based on JPR generating revenues from Export sales from July 2010 onwards.
JPR will continue to market its value proposition to overseas institutions and the Board expects to attract additional investor interest as the Company proves up the NWZ 2 and J-50 wells, validates production flow rates and begins to make oil sales into the various Export markets available to it.
Commenting on the raising, JPR Chairman Geoff Gander said, "JPR is delighted to welcome new institutions to the register. We are committed to developing our relationships in the UK and European markets as the Jupiter story develops over the coming months and in particular when we have proven production rates from the NWZ 2 and J-50 wells."
