Given the backdrop for small oil explorers, the £2.1mln fund raise was no mean feat but the cost was reflected in the heavy discount to the market price when the shares were
suspended in May.
But now with cash secured the company can again concentrate on the next steps for the offshore prospect.
Jeremy Asher, chairman and chief executive, said: “With contingent Oil-In-Place (OIP) estimated at 39 mln barrels (Pmean, gross) already discovered on the block, we now expect to be
in a position to make a drilling decision on this high-quality discovered oil field later in 2018 and so be in a position to take advantage of the low cost of rigs and services in the current
Reprocessing seismic more cost effective
In October, Tower said it would use a new desktop programme to review existing 3D data improve its understanding of the block and to identify possible well locations.
Reprocessing existing 3D seismic data was a more affordable option for the planned work programme ahead, said Asher.
Budgets have been agreed for 2017 and 2018, though subject to progress the parties may agree to extend the initial period of exploration to allow all programmes to be completed.
Trading resumes on AIM
Tower raised the £2.1mln through a placing backed by directors and financier Lansdowne. The shares were suspended in May due to uncertainty over Tower’s financial position.
Asher agreed to subscribe half of his 2017 salary of £150,000 for new shares in Tower in addition to the placing.
Two other directors Peter Taylor and Graeme Thomson subscribed for 5mln and 1mln shares respectively in the placing.
The placing was priced at 1p per share with financier Lansdowne subscribing for 30mln of the 210mln shares issued.
Thali lies in shallow water
Lying in shallow water in the Rio del Rey basin, offshore Cameroon, Tower was awarded an initial exploration licence for 3 years.
The Thali PSC (production sharing contract) covers 119 sq km with water depths ranging from 8 to 48m.
The Rio del Rey basin is a prolific producer in the eastern part of the Niger Delta, with over one billion barrels of oil produced to date and more than double that in reserve.
Thali’s current contingent Oil-In-Place estimate for the Njonji discovery is 39 mln barrels, which is currently viewed as sub-commercial.
Tower sees the re-interpretation of seismic imaging as a way to add incremental oil reserves to achieve commerciality.