(Alliance News) - Bahamas Petroleum Co PLC on Thursday confirmed, despite a sharp rise in its share price, it has no immediate intentions of undertaking an equity placing with institutional investors.
Shares in the Caribbean-focused oil company were 34% higher in London in mid-morning trade at 1.81 pence each.
"As stated in various announcements in August and September, the company has multiple funding options available to it to fund the exploration well intended to be drilled in the first half of 2020, which will provide shareholders with exploration exposure to risked resources between 0.4 and 1.2 billion barrels of oil, with a potential upside in the targeted structure that has been independently assessed at close to 4 billion barrels of oil," Bahamas said.
The company said it has "consistently stated" it will look for a financing package that it considers to be in the best interests of shareholders.
"In this context, in recent days the company has met with a number of potential institutional investors as it considers its funding strategy," Bahamas added.
The oil explorer continued: "However, the board considers that the current share price of the company materially undervalues the project, and thus raising equity by way of a private placing to institutional investors at or below the current share price would not compare favourably with other options presently being considered by the company, and would thus not represent the best value proposition for the company's shareholders."
Bahamas said its will "continue to actively evaluate a range of funding options", with "active" farm-in discussions for its Bahamian licences "continuing".
"The company remains confident it will implement a suitable financing package which will provide access to funding as and when required for drilling and drilling related activities, and which linked to the provision of a rig and access to integrated well services from a collaboration of major international companies will enable drilling to commence as intended in the first half of 2020," Bahamas added.
By Paul McGowan; paulmcgowan@alliancenews.com
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