Southern Energy Corp (TSX-V:SOU, AIM:SOUC, OTC:MAXMD) is raising $6 million, with the money earmarked for new wells.
It will invest to complete three drilled but uncompleted (DUC) wells at the Gwinville project, and the drilling of two vertical Cotton Valley wells at the Mechanicsburg project. As a result, production is expected to increase to 4,000 barrels of oil equivalent per day by the end of this year.
The equity funding will be priced at 4.3p per share (plus a warrant) and it is also amending its credit facility, reducing monthly principal payments and freeing up over $2.5 million to support growth.
In London, absorbing the new incoming equity, Southern Energy shares dropped 15% to trade at 4.01p in Thursday’s early deals.