Angus Energy announced today it had raised just over £3m in a placing of more than 70 million new shares.
The funds would be used for the potential acquisition of an unidentified gas field, as well as work on existing southern England sites at Brockham, Balcombe, and Lidsey, the company said.
A statement to investors on the placing followed online rumours yesterday about the possible acquisition of a gas field.
The share price closed the day down 15.5% at 4.35p. The most recent previous Angus placing was in February 2019.
Angus said money raised from today’s placing would be used for “due diligence” in the acquisition of a 51% interest in a licence and operatorship of an existing UK onshore gas field. The proposed cost of the field is £1, the company said.
According to the statement, the gas field had been in production “on and off” for 20 years. It stopped production in 2017, the statement said, when a nearby refinery terminal closed. According to production data from the Oil and Gas Authority, the only gas field that stopped production in 2017 was Saltfleetby, near Mablethorpe, in Lincolnshire, operated by Wingas.
Angus said the field has eight wells already drilled, with seven completed and ready for production. OGA data on drilled wells, confirms there are eight parent wells at Saltfleetby, some with sidetracks.
Angus said 67 billion cubic feet of dry gas and 1.1 million barrels of condensate had been produced from the field, representing 60% of the gas in place. Total recovery, the company said, could be 70-80%.
The company said the deal was at an advanced stage. The terms would include a cash contribution towards the cost of eventual abandonment. This contribution could also cover the £1.7m cost of connection of the field to the national gas grid. This could be achieved within 12 months and without further calls for cash from shareholders, the statement said.
The statement added that today’s placing would also be used for:
- Ongoing work at Brockham, Surrey, where the company is seeking to isolate a water zone
- Forthcoming work at Balcombe, Sussex, where there are plans for an extended well test and removal of wellbore and drilling fluids
- Seismic overview at Lidsey, West Sussex
Angus managing director, George Lucan, said
“We continue to develop and improve our asset base in the Weald Basin and are very excited to bring this new opportunity to investors. Should the Proposed Acquisition proceed to a successful conclusion it would offer clear diversification benefits and the possibility of cashflow generating production without the near term need for further equity capital.”