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(Sharecast News) - UK Oil & Gas has secured £0.75m in placing proceeds, it announced on Friday, to help fund its potential hydrogen storage project in Portland, Dorset.
The AIM-traded firm raised the money through the placing of new shares at a price of 0.02p each - a 20% discount to the closing price of 0.025p per share on 11 January.
It said the decision to conduct the placing was driven by the UK government's decision to expedite the first hydrogen storage allocation round, now slated for the third quarter of 2024, as opposed to the previous timeline of the second half of 2025.
UK Oil & Gas said it intended to submit a bid for an allocation award for its hydrogen storage project in Portland, Dorset, which needed the acceleration of specific unbudgeted studies and works in 2024.
Additionally, discussions were underway with a notable international trading house regarding its involvement in the company's hydrogen storage project.
The funds raised through the placing would also serve as additional working capital to advance existing UK and Turkey projects.
UK Oil & Gas said £0.75m was raised through the issue of 3.75 billion placing shares, representing 13% of its enlarged issued share capital.
"The placing's proceeds will help us to put our material Portland, Dorset salt cavern hydrogen storage project forward for an allocation award in the government's first hydrogen storage allocation round, now scheduled for the third quarter of 2024," said chief executive officer Stephen Sanderson.
"We are excited by the government's acceleration of the allocation round and its emphasis upon geological hydrogen storage, a welcome recent development which now makes the new hydrogen storage sector real and tangible."
At 1518 GMT, shares in UK Oil & Gas were down 22.4% at 0.02p.
Reporting by Josh White for Sharecast.com.
