Europa Oil & Gas (LON:EOG) has revealed plans to raise up to £3.4mln through share sales.
The company has already agreed a conditional £1.4mln share placing to institutions, and could raise a further £2mln via an open offer to existing shareholders.
New shares will be issued at 6p, a discount of around 20% to Friday’s closing price of 7.88p.
Cash proceeds from the share issue are earmarked for Europa’s share of start-up costs at the Wressle field, onshore UK, as well as covering it share of admin costs associated with the large exploration venture off Ireland’s west coast.
Chief executive Hugh Mackay said he was pleased to have the support of existing and new institutional investors.
“We are seeking to grow our licence holdings in onshore UK and offshore Ireland and the funds raised will enable Europa to undertake new exploration investment as well as funding work on existing projects such as the Wressle oil and gas discovery in PEDL 180,” he said in a statement.
“We look forward to the coming months with excitement and confidence.”
An extraordinary general meeting (EGM) has been called for July 23 for a shareholder vote on the proposed funding.