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(Sharecast News) - 88 Energy announced its intention to raise up to AUD 9.8m (£5.23m) on Tuesday, to strengthen its balance sheet and provide capital for ongoing projects.
The AIM-traded firm said it would raise the funds by placing new shares at a price of 0.3 Australia cents each.
That represented a 40% discount to the closing price on the ASX on 22 April, and a 33.7% discount to the volume-weighted average price on the ASX for the five days prior to 23 April.
Its shares were placed in a trading halt on the ASX pending completion of the placing.
In terms of current operations, 88 Energy said Project Phoenix, focused on oil-bearing conventional reservoirs identified during drilling and logging, had seen progress at the Hickory-1 exploration well.
Flow testing operations had commenced, with positive results from the Upper SFS reservoir and SMD-B reservoir.
Additionally, activities at Project Icewine West and Project Leonis were underway, with plans for further exploration and development.
In Namibia, progress was continuing with a 2D seismic programme planned for mid-2024 to confirm structural closures and assess exploration drilling locations.
The board said the rationale for the placing was to strengthen the company's balance sheet, providing capital for ongoing projects such as Project Phoenix and PEL 93 in Namibia.
Following completion of the placing, 88 Energy anticipated having sufficient funds for at least 12 months of operations, including working capital and general overheads.
The company said it was aiming to attract strategic partners for future stages of development and commercialisation, particularly for Project Phoenix, following the completion of post-flow test analysis at Hickory-1.
At 1501 BST, shares in 88 Energy were down 15.72% at 0.16p.
Reporting by Josh White for Sharecast.com.