- Oil and gas company Warrego Energy (WGO) successfully taps investors for $50 million through a two-tranche share placement
- The company will issue around 227 million shares at 22 cents each to raise the funds — a 10.2 per cent discount to WGO’s last closing price
- The company says the funding will contribute to the first-phase development plan at the West Erregulla gas project in Western Australia
- Warrego owns 50 per cent of the West Erregulla project in a joint venture with fellow ASX-listed Strike Energy (STX)
- Shares in Warrego Energy closed 2.04 per cent lower this afternoon at 24 cents each
Oil and gas company Warrego Energy (WGO) has successfully tapped investors for $50 million through a two-tranche share placement.
The funding will go towards Warrego’s portion of the first-phase development plan at the West Erregulla gas project in Western Australia.
Warrego owns 50 per cent of the West Erregulla project in a joint venture with fellow ASX-listed Strike Energy (STX).
WGO said today will issue around 227 million new shares at 22 cents each to raise the funds. This price represents a 10.2 per cent discount to the company’s last closing price of 24.5 cents and a 13.6 per cent discount to its five-day volume-weighted average price of 25.5 cents.
Under the first tranche, Warrego will issue 147.1 million shares to raise $32.4 million. The second tranche, planned to raise $17.6 million, will only be issued subject to shareholder approval.
Warrego Managing Director and CEO Dennis Donald the company is “delighted” with the strong support for the placement.
“With major offshore projects delayed, significant volumes of Waitsia gas set for export, and the undrilled South Erregulla prospect earmarked for a urea plant, Warrego’s share of West Erregulla will be one of the few new sources of gas destined for the tightening WA domestic market,” Mr Donald said.
“Spot prices in WA have been climbing towards $5 per gigajoule and we are already receiving numerous inquiries about the potential for West Erregulla Phase Two.”
He said the company is developing its carbon strategy with West Erregulla to be its initial focus. He said Warrego has a range of carbon initiatives to help minimise and offset carbon emissions during the Warrego production phase.
Shares in Warrego Energy closed 2.04 per cent lower this afternoon at 24 cents each. The company has a $229 million market cap.