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- Oil and gas company Red Sky Energy (ROG) has frozen its shares until after the weekend in light of an upcoming capital raise announcement
- The fundraiser likely comes as no surprise to shareholders given Red Sky’s cash position at the end of the March quarter
- At the end of March, Red Sky had just $44,000 cash on hand and was expecting to burn around $100,000 over the June quarter
- The company’s June quarter financial figures have not yet been announced, so shareholders can’t do much but speculate until the capital raise details are revealed next Tuesday
- Shares in Red Sky Energy last closed for 0.15 cents each yesterday afternoon
Oil and gas company Red Sky Energy (ROG) has frozen its shares until after the weekend in light of an upcoming capital raise announcement.
The details of the raise are yet to be announced, but Red Sky requested a trading halt until Tuesday, August 4, as it prepares to bolster its balance sheet.
Of course, given Red Sky’s cash position at the end of March 2020, the upcoming raise likely comes as no surprise to investors.
Red Sky had just $44,000 available cash on hand at the end of March and told shareholders it was expecting to burn around $100,000 over the June quarter. Moreover, while the company’s June quarterly figures have no yet been released to the market, it seems Red Sky took on no capital raising over the quarter.
However, the company said in April it had signed a farm-out deal with energy giant Santos over its Innamincka Dome Projects in the Cooper Basin. As part of the deal, Santos is earning an 80 per cent interest in the projects from Red Sky for a potential $9 million.
Of course, given the nature of the deal, Santos would not deposit the cash into the Red Sky bank account, but rather spend the money on exploration and production work at the project.
As such, it’s unsure what kind of impact the deal would have had on company costs over the quarter.
Red Sky shares last traded for 0.15 cents each yesterday afternoon. The company has a $2.45 million market cap.
