Tower Resources PLC (AIM:TRP) has entered into an agreement for a £500,000 bridge loan with Prime Resources Limited.
The loan has a term of up to 12 months and is convertible into shares at a fixed price (at 0.0588p, a premium of around 100% to the recent average share price).
It is seen as a precautionary arrangement, to ensure that the flagship NJOM project is not interrupted as recently announced farm-out transactions complete.
"The purpose of the Bridge Loan is to provide the company with working capital flexibility in preparation for the drilling of the NJOM-3 well on the Thali license in the event that completion of the Cameroon and Namibia farm-out agreements takes longer than expected,” chief executive Jeremy Asher said in a statement.
“The company is confident of receiving the government approvals required to enable completion and is still hoping to do so within the next few weeks.
“However, based on this confidence, the company is also keen to ramp up preparations for drilling, including equipment procurement and staffing, in order to minimise the elapsed time between completion and drilling."