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UPDATE - Tower Resources closing in on Namibia farm out before April spud date

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Tower Resources (LON:TRP) is closing in on a farm-out deal to sell a 10% stake in an exploration venture offshore Namibia.

A number of interested parties have reviewed the “data-room” and follow up enquiries are currently being dealt with, the company said in a statement.

Final well designs and drilling budgets will soon be agreed and it is thought that this will allow the farm-out process to come to a timely conclusion, it added.

Separately, Tower said the Rowan Renaissance drillship is anticipated to arrive in Namibia on or around April 11, and the Welwitchia-1 well would spud the following week.

"We are pleased with the progress on the farm-out process and on the planning and preparation for the important Welwitchia-1 well, one of the largest upside wells to be drilled by an independent in 2014,” said chairman Jeremy Asher.

“We are also well advanced on a number of possible new ventures and we hope to be able to say more about these in the near-future."

Tower also announced on Friday that it raised £820,000, issuing 19.25mln new shares at a price of 4.2p, from a draw down on its finance facility with Darwin Strategic.

Broker Northland has a 'buy' rating on the stock and analyst Andrew McGeary noted: "The very minor fund raise is a little surprising as the company had not previously planned to use its backup Darwin facility.

"However, this is relatively immaterial at these levels. More important is the conclusion of its farm-out and this update looks reasonably positive on that front."

The company has US$18mln in cash having paid US$3mln towards well costs, the broker noted.

Shares advanced 3.01% to stand at 4.275p each.

Quick facts: Tower Resources PLC

Price: 0.575 GBX

AIM:TRP
Market: AIM
Market Cap: £6.35 m
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