The price of UK Oil & Gas Investments PLC (LON:UKOG) shares dropped back 16% on Friday after the onshore driller admitted it is working on an equity raise.
UKOG, in a statement, acknowledged recent speculation and said it was considering raising funds.
It comes as the company advances plans for new drilling and well testing across southern England, where it has a number of assets.
READ: UKOG details conventional resources onshore UK
Earlier this week, for example, the company detailed its current conventional oil and gas resource inventory – revealing some 21mln barrels of oil equivalent – though that doesn’t include any of the high potential, unconventional Kimmeridge play which includes the so-called Gatwick Gusher Horse Hill project, which was speculated to represent a multi-billion barrel project.
In Friday’s statement, UKOG said it was progressing discussions regarding the possible funding, and it would make a further announcement if arrangements were finalised.
“Terms including amount and pricing are to be agreed and there can be no certainty a transaction will be finalised,” it added.
On AIM, UKOG shares fell 16% to trade at 1.05p.