A new share placing could raise £1.9m for the West Newton oil and gas project in East Yorkshire, the leading partner has announced.

In a statement this morning, Reabold Resources said a US-based investor group, led by Rohan Oza,  had committed to buy 1,900 million ordinary shares at 0.1p each.

The funds raised in the placing would be “used primarily to progress the key West Newton project”, Reabold said. Development of the field has previously been beset by delays and cash shortages.

The statement said the funds would meet the costs to Reabold and the site operator, Rathlin Energy, of work at the West Newton-A site to recomplete the second well, WNA-2. Last month, the Environment Agency granted permission for lower-volume hydraulic fracturing on WNA-2.

The share placing is conditional on Reabold raising a further £1.1m before 12 May 2026, the statement added.

Participants in the placing will receive 1.25 warrants for each new ordinary share. Each warrant can be converted to an ordinary share at 0.11 p per share.

Reabold said this mechanism aimed to provide access to additional capital if the recompletion were successful and the well could move into early production.

Sachin Oza, co-chief executive of Reabold Resources, said:

“Having recently received the required environmental permitting to conduct stimulation operations at the A-2 well, this funding will allow the JV [joint venture] to move ahead with operations in the coming months, which will be a key step in unlocking the inherent value in our flagship project at West Newton.”

Delays

In 2024, DrillOrDrop reported the development of the West Newton oil and gas field had seen more than 15 years of delays, missed deadlines, protests, permit breaches and changing plans.

The licence, PEDL183, was granted on 1 July 2008 and planning permission for West Newton-A was first granted in January 2013.

But neither West Newton-A nor the second, neighbouring site, West Newton-B, have seen any formal hydrocarbon extraction to date.

The duration of planning permission for West Newton-A was extended twice, in 2015 and 2018.

In March 2022, West Newton-A received planning permission for 20 years of oil production, expansion of the site and more drilling. Work on the expansion and drilling, yet to start, must begin by 28 March 2027.

In accounts published last year, Rathlin Energy reported it could drill a new well at West Newton-A, targeting the Kirkham Abbey Formation.

The accounts revealed that Rathlin had a working capital balance of £800,000. The estimated cost to Rathlin to develop wells at both West Newton sites was £9m.