Southern Energy Corp (TSX-V:SOU, AIM:SOUC, OTC:MAXMD) said it has completed its previously-announced US$31 million offering by issuing 46,371,927 new company common shares.
The natural gas exploration and production company noted net proceeds from the offering will be used to accelerate the initiation of a continuous organic drilling programme at its Gwinville field, as well as increase Southern Energy's financial flexibility for potential acquisition opportunities.
“With our strengthened financial capability, we now look ahead to further exciting operational activity at Gwinville while also being capable of considering M&A opportunities in our core area of expertise from a position of strength,” Southern Energy CEO Ian Atkinson said in a statement.
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“With a multi-year drilling inventory in Gwinville alone, we look forward to realising our forward growth potential of our goal to reach 25,000 boe/d (barrels of oil equivalent per day); with more drilling anticipated to begin later this year,” Atkinson added.
Southern Energy said certain directors and other persons discharging managerial responsibilities (PDMRs) of the company have participated in the prospectus offering, on the same terms as all other participants, to subscribe for a total of 448,274 prospectus shares.
It added that the underwriters will not be exercising the over-allotment option granted to them in connection with the offering.
In addition, the company reported that on June 27, 2022, it has entered into basis swaps covering just under 40% of its physical price exposure with a natural gas basis swap transaction to secure an average premium to NYMEX of $0.39 per Metric Million British Thermal Unit (MMBtu) from July 1, 2022 to December 31, 2022, due to increased natural gas demand in the southeast Gulf States.
Southern Energy added that it continues to monitor these premium prices and is prepared to hedge additional basis exposure at these elevated basis premiums.
Southern Energy is a natural gas exploration and production company. It has a primary focus on acquiring and developing conventional natural gas and light oil resources in the southeast Gulf States of Mississippi, Louisiana, and east Texas.
Contact Sean at sean@proactiveinvestors.com