Prospex Energy to double its holding in the Selva Field in Italy
(PXEN ) has raised £2.395 million before expenses which the company will use to more than double its current holding in the Selva Field in Italy from 17% to 37%.
The investment company, which is focused on European gas and power projects, said the move will add some 2.7 billion cubic feet (“Bcf”) of 2P gas reserves to Prospex’s portfolio.
The proceeds of today’s fundraise will also enable Prospex to fund the development costs of the Selva project towards first gas production which is currently expected to occur in 1Q23.
In addition, any proceeds raised from the broker option scheme will be used to fund several business development activities, including providing funds to accelerate the planning and execution in Q4 2022 of the first infill well in the Company’s El Romeral power project in Southern Spain through its 49.9% shareholding in Tarba Energía (“Tarba”), it explained.
If the income generated by the El Romeral power project does not cover the overheads of the Company, then certain of the proceeds may be used for general working capital purposes.
This morning’s placing price of £0.001 at a price of 3.5p per share represents a discount of 16.7% to the closing middle market price of 4.2p per ordinary share on Friday afternoon.
Commenting on the placing, Mark Routh, CEO of Prospex said:“This placing has exceeded expectations and we have surpassed the minimum amount we needed for Selva from existing and new investors.
We have had full support from our major shareholders and participation from all Board directors and we have closed the placing without issuing any warrants.”
Routh explained that any extra funds received via the company’s broker option scheme will allow Prospex to accelerate and advance work on the infill well drilling campaign on the El Romeral concession in
Spain currently waiting on permits to drill the first three infill wells.
Routh added that the first two wells to be drilled at El Romeral on two proven gas-bearing structures are expected to bring the generation utilisation of the plant up to full capacity.
In recent weeks, Prospex Energy has said it is committed to achieving first gas from the Selva field development project in Italy “as soon as possible” while it awaits production concessions.
The investment firm holds a 17% working interest in the Podere Gallina licence through its subsidiary PXOG Marshall, with the Selva Malvezzi concession contained in this licence.
Prospex unveiled the acquisition of a further 20% of the Podere Gallina licence from United Oil and Gas and UOG Holdings (a wholly-owned subsidiary of UOG) in August 2021, by way of a transaction of
100% of UOG Italy which has a 20% interest in the Podere Gallina licence.
Under the terms of the agreement with UOG, the long-stop date by which the transaction should complete has been extended by mutual consent from 7 March 2022 to 6 April 2022.
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