(Alliance News) - Union Jack Oil PLC on Wednesday said it has raised GBP5 million to fund its "highly accretive projects".
The UK-focused oil exploration company has raised the new money via placing of 2.93 billion new shares at 0.15 pence each and subscription of 404.3 million shares at the same price.
Union Jack Oil shares were down 4.2% at 0.17p in London on Wednesday afternoon.
"The proceeds will be deployed into what Union Jack believes are highly accretive projects including the drilling and testing of two further appraisal wells and the acquisition and reprocessing of new seismic data at the company's flagship asset at West Newton," the Bath-based company said.
The company owns 16.7% interest in West Newton project, contained within PEDL183 licence located in east Yorkshire.
Funds will be used to drill an anticipated side-track well at Biscathorpe in Lincolnshire and to provide additional working capital, Union Jack added.
David Bramhill, executive chair of Union Jack, said: "The directors are extremely confident about the future prospects for Union Jack and look forward to updating the market on developments at West Newton and our wider portfolio."
Joseph O'Farrell, an executive director, subscribed for 33.3 million shares in the fundraising. Following the purchase, O'Farrell owns a 1.8% stake in Union Jack.
By Tapan Panchal; tapanpanchal@alliancenews.com
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Union Jack (UJO)