FAROE Petroleum said yesterday it would raise £69.8m in a rights issue to fund its exploration and drilling programmes.
The fundraising will allow the Aberdeen based company to drill up to eight new wells over the next two years, bringing its total to sixteen.
The AIM listed oil and gas company also plans to apply for new exploration licences in the UK, Norway and Greenland.
John Bentley, chairman of Faroe, said: “This transaction is transformational for Faroe. It ensures that the company is fully financed for both its firm and expected drilling programmes. We are also delighted to be able to advance both our exploration licence portfolio and our production base.”
Faroe’s full-year results revealed pre-tax losses of £11.8m, compared with £28.8m a year ago. The results were helped by the sale of its Breagh gas field interest. Full-year revenue increased three-fold to £7m.
“We’ve spent a lot of money investing drilling wells. This remains our major priority,” said chief executive Graham Stewart.
PANMURE Gordon is acting as Faroe’s financial adviser and broker, with Dominic Morley heading up the team. Morley said the fund raising was going according to plan and that take up from investors had been good.
Morley recently advised MAMA Group on its acquisition by HMV in January. He also advised on several capital raisings in 2009, including Borders and Southern and JJB.
In the same year he advised BPP on its £300m take over by Apollo.
Morley has spent 15 years at Panmure, where he is managing director in the corporate finance division.
He previously spent five years as a lawyer at Ashurst. He graduated from Bristol University with a degree in law. Morley lives with his family in London and is a keen tennis player and fan of Chelsea Football Club.
Panmure Gordon is a corporate and institutional stockbroker and investment bank. Founded in 1876 by Harry Panmure Gordon, the group operates from London, and also has offices in San Francisco, New York, Boston, Chicago and Minneapolis.