(Alliance News) - Tower Resources PLC on Monday said it will raise gross proceeds of GBP500,000 through the placing of around 133.3 million shares at 0.375 pence each.
Shares in the Africa-focused oil & gas firm were trading 13% lower at 0.37p each on Monday afternoon in London.
Tower Resources said its broker Turner Pope Investments has agreed to receive 5.3 million of the placing shares in lieu of part of its commission at the share placing price.
Proceeds realised from the placing will be used to provide working capital while the company completes the farm-out agreement with Australian firm OilLR Pty Ltd for a 25% working interest in the Thali production sharing contract in Cameroon.
"We have carried out this small placing to mitigate the risk of running low on cash as we seek to complete our well financing. We have kept the placing small because we do not like issuing shares at our current share price, given the superior economics for our shareholders of farming out on our agreed terms. Nevertheless, we felt that it was prudent to have some cash cushion at this time," said Tower's Chief Executive & Chair Jeremy Asher.
Following admission, Tower Resources' share capital will comprise around 1.2 billion shares.
By Ife Taiwo; ifetaiwo@alliancenews.com
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Tower Resources (TRP)