InfraStrata is pleased to announce the placing of 4,095,000 new ordinary shares at 22p per share to raise £900,900 before expenses. The shares were placed by Seymour Pierce Limited with an existing institutional investor.
Following the placing, the Company will have 78,264,326 ordinary shares in issue. The Placing Shares will represent approximately 5.23 per cent. of the Company's Enlarged Share Capital. Application has been made for the shares to be admitted to AIM and admission of the shares is expected to be on 10 February 2011.
The net proceeds of the Placing receivable by the Company will be applied to support both the development of the Islandmagee Storage Project until the introduction of a new partner, and the committed expenditure programme of InfraStrata through its 2011/12 financial year.
For further information please contact:
Andrew Hindle, Chief Executive Officer
Craig Gouws, Chief Financial Officer
020 8332 1200
Financial PR - Buchanan Communications
020 7466 5000
Nominated Advisor and Broker - Seymour Pierce
Jonathan Wright/ Jeremy Porter - Corporate Finance
Richard Redmayne - Corporate Broking
020 7107 8000
Notes to Editors:
Background on InfraStrata plc
InfraStrata plc is developing two gas storage projects in the United Kingdom at Portland, Dorset (50% interest) and at Islandmagee, County Antrim, Northern Ireland (65% interest). The two projects could between them provide over 10% of the total UK and Ireland peak daily demand in the latter part of this decade. During 2010, the Company took the decision to enhance its existing gas storage business within the two core areas. This includes conventional and unconventional petroleum exploration, where the Company can use its existing geological and geophysical knowledge and databases to identify and fund opportunities.
The proposed 500 million cubic metres ("mcm") facility would be the largest on the island of Ireland and the first for Northern Ireland. It would make a significant contribution to the security of gas supplies. The facility is being designed to inject gas at 12 mcm and withdraw gas at 22 mcm per day. The cost of construction has been estimated at circa £250 million, including cushion gas. The project is owned by Islandmagee Storage Limited ("IMSL"), an independent Northern Ireland registered company. Its two shareholders are a wholly owned subsidiary of Mutual Energy, an operator of existing key gas and electrical infrastructure in Northern Ireland, and a wholly owned subsidiary of InfraStrata plc.
A planning application for the Islandmagee Storage Project was submitted in March 2010. The submission of the planning application followed more than two years collating information and carrying out very thorough investigative studies into the development of a natural gas storage facility within a Permian salt sequence a mile beneath Larne Lough, including a 3D seismic survey carried out in 2007. Since then IMSL has been consulting extensively with stakeholders and local resident groups and held two well attended public exhibitions during 2009.
The storage of natural gas in salt caverns occurs throughout the world and facilities have been operating safely in the UK since the 1970s. Salt storage facilities can store and retrieve gas very quickly. This will be important for the availability of gas supplies for power stations to respond to intermittent wind generation in the future greener energy mix in Northern Ireland. The Larne area is the only area on the island of Ireland where a suitable salt sequence is present. In addition to the favourable geology of the area, Islandmagee already contains the main gas and electricity network required for a gas storage project, along with access to the water required to dissolve the salt to form the caverns. The proximity to this important infrastructure reduces the environmental impact of the facility.
In addition to the security benefits, the project would also result in the creation of more than 20 high quality permanent jobs for the Larne area, and bring in benefits for local businesses (e.g. support services, accommodation, retail etc.) during the construction phase.
The Islandmagee Project is an important element of InfraStrata's portfolio and the Company remains hopeful that following submission of a planning application in March 2010, this strategic asset for Northern Ireland will be granted planning permission in the first half of 2011 to enable drilling of the first cavern well to commence before the end of 2011. Front End Engineering Design will commence following acquisition of data from the well, leading to the point when the decision to proceed to full construction is expected to be taken during 2012.
The Company opened an online data room in November in conjunction with project partner Mutual Energy Limited, and is currently in discussions with several major companies who have expressed an interest in a potential equity participation in the project.
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