14th Jan 2014 12:00
LONDON (Alliance News) - Sound Oil PLC Tuesday announced its 24-month work programme in Italy and new funding arrangements for the period.
The oil and gas company, with operations in Europe, said the programme has been updated to reflect recent permitting, prioritising positive exploration prospects such as Badile and accelerating material cash flows from existing discoveries at the Nervesa and Santa Maria Goretti permits.
Sound Oil said that it plans to fund key drilling, including at Nervesa and Badile, through the joint venture partners in order to build a portfolio of producing assets to cover the company's overheads.
The company said its key goals are to maintain strong production from its Rapagnano onshore gas field in the Marche region, develop the Casa Tiberi onshore gas discovery during the first half, and drill a second appraisal well at the Nervesa discovery in the second or third quarter.
Sound Oil also plans to secure drilling permission for the Badile prospect and drill the site in the fourth quarter 2014 or the beginning of 2015.
The company separately announced a GBP1.6 million discounted open offer of shares, issuing up to 38.3 million shares at 4.2 pence, a 33% discount on Monday's closing price.
It also announced an 18-month asset-backed loan from new Non-Executive Director Simon Davies of GBP1 million which may be increased at the company's discretion to GBP1.5 million.
Davies, previously executive chairman of Threadneedle Asset Management, holds 7 million shares in Sound Oil, 2.5% of the total, and will subscribe to the new offer. Chief Executive Officer James Parsons and Chairman Andrew Hockey also will subscribe, Sound Oil said.
Also joining Sound Oil as a non-executive director is Gerry Orbell, a petroleum geologist who has worked with Premier Oil PLC and Petrofina, a Belgian oil company that was acquired by France's Total SA in 1999.
Sound Oil shares were down 1.6% to 6.15 pence Tuesday.
By Tom McIvor; [email protected]; @TomMcIvor1
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