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88 Energy (LON:88E, ASX:88E) has successfully raised $3mln though an oversubscribed share placing.
The company will also open a share purchase plan to eligible existing shareholders with a view to raising a further $2mln.
It comes after the company significantly increased its position on Alaska’s North Slope, an area referred to as Project Icewine, where it is currently drilling a potentially high impact exploration well.
The well is designed to test a large shale play, as well as a number of conventional oil and gas targets.
The cash is earmarked for payments to secure the extended footprint at Icewine.
Yesterday the company revealed it could acquire 174,240 acres to take the total size of the project to 272,242 acres.
Dave Wall, 88 Energy managing director, said: “The acquisition of the additional acreage was considered strategically important ahead of the results of Icewine#1 as we feel that we have a competitive advantage in identifying where the play may work.
“The low oil price also meant that competition was scarce, resulting in an opportunity to create maximum leverage for our shareholders."
He added: "Overwhelming support was shown by new and existing shareholders for the placement and our strategy at this exciting time for the company."
To raise the $3mln 88 Energy is issuing 300mln new shares at 1 cent each.
On AIM, 88 Energy shares rose 3.7% on Friday to trade at 0.55p each.