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Canadian Overseas Petroleum raises £14mln to hit the ground running with Atomic assets

Published: 02:33 09 Mar 2021 EST

Canadian Overseas Petroleum Limited - Canadian Overseas Petroleum raises £14mln to hit the ground running with Atomic assets

Canadian Overseas Petroleum Ltd (LON:COPL, CSE:XOP) has raised £14mln through a share placing with the proceeds earmarked for its new North American assets, which are being acquired in the Atomic Oil & Gas deal.

The company yesterday, after the close, launched a bookbuild process for the funding which this morning was confirmed as closed.

COPL highlighted that the share sale process was oversubscribed.  Some 4.3bn new shares are being sold to institutional investors and high net worth private investors/family offices. The shares are priced at 0.32p per share.

READ: COPL’s Atomic deal moves closer to completion

"The funds from this placing will strengthen COPL's balance sheet post completion of Atomic,” said Ryan Gaffney, COPL chief financial officer.

“This is the prudent thing to do at this time as it gives confidence to the company's debt provider, the oil field service providers, suppliers of natural gas and natural gas liquids for Atomic's Barron Flats miscible flood."

Arthur Millholland, chief executive, meanwhile added: “We are on track to close the Atomic acquisition on March 15. Post-closing the company will require sufficient working capital to operate Atomic and its assets according to its forward development plan.

“These include, commencing on April 1st, a dramatic increase in injected gas volumes (methane and LPG) at the Atomic operated Barron Flats Unit.

“The institutional investors in this placing recognize the quality of the assets we will acquire under the Atomic acquisition and their value to the Company in this time of strengthening global oil prices."

The Atomic acquisition brings producing assets in the US state of Wyoming, the Barron Flats Shannon Unit (57.7% owned by Atomic) and Cole Creek Unit (66.7% owned by Atomic).

Barron Flats produces around 1,400 barrels per day (bpd), up from 200 bpd in 2017, and is forecast to reach a plateau rate of 5,000 bpd gross by 2022.

The Cole Creek asset, meanwhile, is forecast to have a 3,500 bpd plateau by 2026.

Significantly, the fields are at the front end of what’s expected to be a 40+ year operating life.

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