Independent Oil & Gas (LON:IOG) has confirmed a £10mln convertible loan funding deal with London Oil & Gas Ltd (LOG).
The debt will carry interest at 9% per year, and can be converted into IOG shares at a price of 8p per share.
Mark Routh, IOG chief executive, told investors that as a result of the deal the company would have enough money to cover corporate expenses and fees until mid-2018.
“This transaction will significantly strengthen our balance sheet and enhances our access to capital, thereby enabling us to capture attractive, value enhancing opportunities created by the current phase in the oil price cycle,” Routh said.
“Following the recent extension to the Skipper licence until the end of 2016, we remain ready to remobilise on the appraisal well at the earliest feasible opportunity.”
The company also confirmed a number of board appointments.
Martin Ruscoe, a director of LOG, has been appointed as non-executive director and LOG’s Clint Redman joins in a part-time role as head of corporate finance. Meanwhile, current non-executive director Marie-Louise Clayton is stepping down.
IOG shares advanced 1.12p, 18.75%, to trade at 7.12p on Friday. At this level IOG’s market capitalisation is £5.54mln.