Talon Energy (ASX:TPD) locks in $14m capital raise for WA asset development

• Junior oil and gas explorer Talon Energy (TPD) successfully taps investors for $14 million to advance exploration and development work across its WA assets
• The company plans to raise $12 million through a private share placement and $2 million through a share purchase plan, with all new shares to be priced at 14.5 cents
• Talon will put the cash towards its share of the final development and operating costs of its Walyering gas JV project and further exploration in the Perth basin
• Meanwhile, the company says it has launched a strategic review to optimise the value of its 33 per cent interest in the Gurvantes project in Mongolia
• TPD shares closed 9.1 per cent lower at 15 cents on Friday afternoon

Junior oil and gas explorer Talon Energy (TPD) has successfully tapped investors for $14 million to advance exploration and development work across its WA assets.

The company plans to raise the funds through a $12 million private share placement and a $2 million share purchase plan. All new shares will be priced at 14.5 cents — a 12.1 per cent discount to Talon’s last closing price on March 1.

Talon Managing Director Coby Hauser said this capital raise would fully fund the company’s share of final development and operating costs for the Walyering gas project, which it owns in a 45/55 split with Strike Energy (STX).

“Walyering is expected to be WA’s next onshore gas producer and will be a low-cost, low-carbon-intensity project that is well placed to meet WA’s growing industrial gas demand,” Mr Hauser said.

“Although we undertook an extensive debt funding process and received credit approved terms from providers, the board has decided to undertake an equity raise as it provides the greatest certainty to fund and accelerate upcoming exploration commitments and more importantly offers the flexibility to utilise cashflows and explore various ways to
grow value for Talon shareholders.”

Alongside its Walyering costs, Talon said it would put the funds towards further exploration in the Perth Basin, including farm-in costs of a recently-acquired permit.

Meanwhile, the company said it had launched a strategic review to optimise the value of its 33 per cent interest in the Gurvantes XXXV project in Mongolia. This could include a de-merger or another type of transaction.

TPD shares closed 9.1 per cent lower at 15 cents on Friday afternoon.