Zephyr Energy PLC (AIM:ZPHR, OTCQB:ZPHRF) has landed a US$100 million investment deal, to fund an expansion of its non-operated production portfolio – enabling an acceleration of growth and cash flow.
The company, in a statement, announced that a US-based energy investor is injecting US$100 million into a new vehicle, called Zephyr Hawk LLC, which will acquire and manage the assets.
Through this structure, the investor will fund 100% of the drilling, completion and equipping costs for non-operated assets in the Williston Basin. Zephyr retains an option to fund 33% of the costs.
Zephyr sees the Williston portfolio as a “cash generating engine” for the company, with the non-operated assets currently yielding some 1,150 barrels oil equivalent per day and around $24 million of revenue per quarter.
With the investment deal, it expects to grow substantially.
"We are delighted to announce the entry into this strategic Agreement with a highly respected energy-sector investor and the formation of Zephyr Hawk LLC,” Zephyr chief executive Colin Harrington said in a statement.
“Zephyr's management and deal sourcing capabilities should allow for significant new growth in our non-operated portfolio.
“We view this new agreement as an excellent way to utilise experienced industry capital to further grow our cash flow foundation."