Longreach Oil & Gas (CVE:LOI) announced interim financing measures as it gears up for the drilling of a second well at the Sidi Moktar licence, onshore Morocco.
It has given notice for the contractor to move the rig to the Kamar well location.
It comes after results, earlier this month, of the Koba-1 well were announced.
The firm now plans to complete a debenture financing of between C$10mln and C$15mln with qualified investors for the ongoing development of the Kamar well and general corporate purposes.
These will bear interest at 10% per annum and will mature two years from closing. It is expected that purchasers of debentures will also receive non-transferable bonus warrants to purchase ordinary shares of the Company for two years from closing (subject to adjustment) with an exercise price of at least C$0.30.
Longreach added that if the proposed financing is completed, the firm intends to repay the debentures with the proceeds of a subsequent share offering, which may include a rights offering to all shareholders.