Tower Resources PLC (AIM:TRP) is progressing with its proposed farm-out to an undisclosed potential partner and expects the deal will deliver more than $14 million for the planned well programme.
The NJOM-3 well programme, in Cameroon, which is already part-funded, is the primary focus of the deal and it promises to unlock the commercialisation of what is a cornerstone asset for Tower.
"We are very pleased with the progress of the farm-out process and look forward to finalising an agreement in the near future,” Tower chief executive Jeremy Asher said in a statement.
Since previous announcements, Tower said it has a more detailed funding proposal from the potential partner (described previously as “a substantial upstream company”).
Under the proposal, the partner would take a minority stake in the asset and Tower would remain the project’s operator.
Talks remain open with potential alternative partners.
Meanwhile, Tower is reviewing the current proposal and clarifying its terms where appropriate. It expects to work on detailed contracts with this partner, or one of the other parties, over the coming weeks.
Tower is also talking to African banks over separate financing arrangements to support the near-term plans to advance the NJOM asset and has today announced an equity placing to raise around £1.2 million.
It is selling 4.4 billion shares at a price of 0.027p per share, a discount of around 22% from yesterday’s closing price.
This injection of capital will support ongoing commitments and preparations for the NJOM-3 well, along with Tower's projects in Namibia and South Africa.
Jeremy Asher added: “Although the Thali farm-out is a key priority for us, we also want to move forward with our work programme in Namibia and we must ensure that we can also keep well planning on track while financing discussions are completed. This is a very exciting time for the company."