30th Mar 2016 12:26
LONDON (Alliance News) - Independent Oil & Gas PLC shares rose on Wednesday after the company satisfied all the conditions necessary to secure the GBP13.6 million of financing to be supplied by London Oil & Gas PLC, allowing it to pursue new acquisition opportunities.
The company confirmed later on Wednesday it was holding talks to buy the other half of the licence areas in the North Sea which contain the Blythe gas discovery.
Independent Oil shares were up 9.4% to 11.35 pence per share on Wednesday morning.
Independent Oil is now in a position to draw down those funds and said the company is "well-funded" and able to pursue new opportunities as a result.
"We are delighted to complete the London Oil & Gas financing transactions. The company is now well-funded with a strong balance sheet and access to finance to pursue a number of low risk, value accretive opportunities created in the current market conditions," said Chief Executive Mark Routh.
"We are working closely with London Oil & Gas, who have an excellent track record and a wealth of experience to identify and progress near term opportunities and I look forward to updating shareholders on the company's progress in due course," he added.
Importantly, the financing secured Wednesday is in addition to the GBP10.0 million worth of convertible debt funding supplied by London Oil & Gas in deal struck earlier this year, which followed on from USD3.6 million worth of funding back in late 2015.
When the convertible debt funding was secured, Independent Oil said the funds meant its corporate and other general costs were covered until mid-2018, suggesting the funds secured Wednesday are solely there to allow Independent Oil to pursue its strategy and seek new opportunities.
Earlier on Wednesday, Independent Oil said it will look to acquire oil and gas developments that are edging towards production in the near-term or developments that are low risk within the North Sea, but said it will also consider "compelling" opportunities outside of the North Sea.
A number of potential acquisitions have already been identified, it said on Wednesday morning, before confirming later in the day it was holding talks to acquire the remaining 50% stake in the Blocks 48/22b and 48/23a licence areas in the North Sea from Alpha Petroleum Resources Ltd. The licences contain the Blythe gas discovery.
Independent Oil said it will continue to develop its existing portfolio, which is comprised of the Blythe, Skipper and Cronx licences, all in the UK North Sea, alongside the Elgood and Hambleton discoveries which also lie offshore the UK.
By Joshua Warner; [email protected]; @JoshAlliance
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