Black Bear Energy Resources PLC (LON:BBER) has announced fundraising plans as it looks to begin work on its oil and gas asset in Michigan and complete a leasing deal in Texas.
It is offering five million shares for subscription at 12 pence each for a total of £600,000. Investors will also receive a warrant for every two shares they own exercisable at 14 pence, which could bring in an additional £350,000.
Founder and chief executive, Anthony Mason, said: “We are very enthusiastic about moving ahead with this placement.
“This is a very solid step for Black Bear Energy Resources as we look to commence the work in the Enders Area of Mutual Interest in Michigan and complete the leasing programme in East Texas.”
The Enders area totals 1,400 acres to the west of the state’s lower peninsula that separates lakes Huron and Michigan.
The plan is to re-enter the 1-30 well, going down to a comparatively shallow 1,450-1,550 feet and then out 2-3,000 feet laterally.
Here’s where it starts to get really interesting: Black Bear Energy Resources is introducing a technique called fluid-free fracking to this area, which is safe, environmentally benign and has none of the costly issues of waste disposal associated with traditional fracking.
It is a process used by drilling giants Halliburton and Baker Hughes, and CEO Mason, a veteran and innovator of the E&P sector, sees it as the most effective approach for the local Berea sandstone.
Black Bear Energy Resources’ next cab off the rank after Michigan is the Braveheart Pinnacle Reef in East Texas.
This is a 597-acre lease located in a prolific natural gas-producing formation with 50bn cubic feet of gas in place (on a P50 basis), which could produce at 30-35mln cubic feet a day.