88 Energy Ltd (AIM:88E, ASX:88E, OTC:EEENF) has launched a £15.8mln (A$30mln) equity funding ahead of next month’s drill campaign, which was confirmed earlier today.
The company today said it had received the green light for the Merlin-2 appraisal well on Alaska’s North Slope.
An injection of capital now aims to strengthen the balance sheet and support a possible flow test of the Merlin-2 appraisal, subject to results. It could also help fund potential new ventures, the company added.
88 Energy noted that it expects it will now have sufficient cash to fund its ongoing working capital requirements and general and administrative overheads for at least 12 months.
New shares are being issued at the equivalent of 1.8p (A$0.035), through a bookbuild process run by stockbrokers Cenkos in the UK and EurozHartleys in Australia.
The funding will initially be for £10.5mln (A$20mln) and the brokers have the ability to accept over-subscriptions of up to £5.2mln (A$10mln).
It is expected that the new shares will be issued under the company’s existing placement capacity therefore shareholder approval will not be required for the placing.