- Blue Energy (BLU) raises $20 million to undertake appraisal drilling and production testing at its Bowen and Surat basin assets
- Specifically, the money will go towards the drilling of a second Sapphire Pilot well, two lateral wells and 2D seismic data acquisition
- The company will issue 322,580,645 shares to institutional and sophisticated investors at 6.2 cents per share to raise the funds
- Shares are expected to settle on August 2 and be allocated on August 3
- Blue Energy is down 9.33 per cent with shares trading at 6.8 cents at 1:01 pm AEST
Blue Energy (BLU) has raised $20 million to undertake appraisal drilling and production testing at its Bowen and Surat basin assets.
Of the $20 million, $8 million will be used to drill a second Sapphire Pilot well at Bowen Basin, $5.3 million will go towards two lateral wells at Surat Basin, $3.6 million will be used for 2D seismic acquisition in the Greater McArthur Basin assets and the remaining $3.1 million will be used for working capital.
The company will issue 322,580,645 shares to institutional and sophisticated investors at 6.2 cents per share to raise the funds.
This price represents a 17.3 per cent discount to Blue Energy’s last closing price of 7.5 cents and an 18.4 per cent discount to its 10-day volume-weighted average price.
The new shares are expected to settle on August 2 and be allocated on August 3.
“It is clear that there is an understanding from investors of the importance of natural gas supply into the east coast market and the reliance of manufacturing on natural gas, as well as the need for natural gas as a supply for gas-fired electricity generation to firm the increasing levels of wind and solar energy in the National Energy Market energy mix,” Blue Energy Managing Director John Phillips said.
“This has been in stark view recently as the Australian Energy Market Operator (AEMO) AEMO has needed to intervene in both the electricity and gas markets to maintain system stability. More new gas supply is crucial to the energy security on the east coast.”
Blue Energy was down 9.33 per cent with shares trading at 6.8 cents at 1:01 pm AEST.