London listing to fuel Sylvan

A US oil and gas explorer is set to list in London this month with a market value of around £60m.

Sylvan Energy, based in Pennsylvania, has hired Northland Capital Partners as adviser and broker as it prepares to raise £5m on the Alternative Investment Market.

Sylvan, an onshore exploration and production firm, currently has more than 2,500 drilling sites across 25 projects in the Appalachian Basin, the Gulf Coast Basin and the Michigan Basin.

The management team – led by founder and chief executive Neil Sullivan, whose 39 years in the industry have included spells at Texaco and Conoco – is currently in London to meet potential investors. They will own about 40 per cent of the business after the listing.

Sullivan said: “Over the past four years we have assembled a diversified and de-risked asset base combining an exciting combination of low risk shallow oil development and high impact exploration properties… The move to join AIM will give us access to capital in the future as we maximise the potential of these great assets.”

Sylvan has begun drilling at a small number of sites and has devised an “aggressive” drilling plan for around 130 wells for the year after flotation.

The listing would be the latest in a series of fundraising exercises for Sylvan, whose 2011 revenue was $1.4m (£893m). It has agreed the sale of 90 per cent of its Appalachian Basin shale assets for $23m and is finalising concluded an agreement with a US hedge fund for $12m of expansion capital.

Ruspetro, the Russian oil and gas explorer, was the first company to brave a main market listing in London this year when it raised £163m in mid-January.