(Alliance News) - Caspian Sunrise PLC said Monday it will purchase new drilling equipment for USD7 million, to be raised by the issue of shares in the oil & gas company.
The equipment to be acquired includes four drilling rigs, two cranes, pumps, generators, a blow-out preventor and 12 vehicles.
The equipment will go towards the 10-well infill drilling programme on the MJF structure in Kazakhstan, and be expected to reduce operational delays and drilling costs, as well as speed up the development of Caspian's oil fields.
Specifically, the company said it expects the 10 well drilling programme to be completed sooner than the initial 20-month estimate.
Completion of the acquisition is conditional on inspection of the equipment, and the USD7 million payment will be funded by the issue of 58.3 million shares at 10 pence per share.
Shares in Caspian Sunrise were up 2.4% at 10.60 pence on Monday.
Caspian has formed a new division, Caspian Sunrise Services to lead the development of the group's assets.
"This marks another natural step in the company's progression as a full-fledged oil producer. It will allow us to develop our oil fields quicker and more cheaply than has been the case to date," said Executive Chair Clive Carver.
Following the issue, Caspian Sunrise will have 1.88 billion shares issued overall.
Caspian Sunrise (CASP)