88 Energy has successfully completed a bookbuild to domestic and international institutional and sophisticated investors to raise up to A$10.07 million before costs through the issue of up to 1,678,333,334 fully paid ordinary shares in the capital of the Company at an issue price of A$0.006 (equivalent to £0.033) per New Ordinary Share.
Each of the Directors intend to participate in the Placement. Accordingly, the Company intends to seek shareholder approval for the Directors to participate in the Placement by subscribing for a total of 11,666,667 New Ordinary Shares. A shareholder meeting notice will be dispatched shortly and made available for shareholders on the Company’s ASX platform (ASX:88E), with the anticipated meeting date for the upcoming general meeting to be a date towards the end of December 2020.
The capital raised under the Placement, together with the Company's existing cash reserves (A$4.6 million as at 30 September 2020, inclusive of Joint Venture cash), will be used to fund the ongoing evaluation of the conventional and unconventional prospectivity of the Company’s existing assets, including its share of any potential costs in respect to the Peregrine wells, which are due to spud in late February 2021, and to enable it to identify and exploit new opportunities on the North Slope of Alaska.
By strengthening the Company’s balance sheet, the Placement will also provide the Company with sufficient capital to:
- fund well costs for the Project Peregrine wells above an anticipated farm out / carry (first well expected to spud late February 2021);
- lease rental payments on the Company's Alaskan acreage;
- fund interest payments on the Company's debt facility;
- apply funds towards new venture opportunities; and
- finance the Company's ongoing working capital requirements and general and administrative overheads.
Commenting on the Placement, Dave Wall, Managing Director of 88 Energy, stated:
'Completion of this placement positions the Company strongly as preparations continue for the drilling of the Merlin-1 and Harrier-1 wells, which will test multiple conventional targets, in Q1 CY2021. Final documentation in relation to the Peregrine farm-out with the preferred bidder is progressing with execution of final documents expected in the next few weeks. Planning and permitting remains on schedule for a late February 2021 spud of the first well at Project Peregrine. We would like to thank our advisers and shareholders for their continued support as we enter into this critical phase.'
Euroz Hartleys Limited acted as Sole Lead Manager and Sole Bookrunner to the Placement in Australia.