The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
The thing that gives me a bit of confidence is Orion paid a decent premium when HZM had no cash or finance. With HZM having finance approved it derisks the project for us shareholders and the strategic investor. So I would hope they say a premium to the share price again. All imo.
£52m on top of the £35m raised is a lot of money for working capital!
"The Company also announces that it has executed farm-in agreements with Equinor Energy AS ("Equinor") and Spirit Energy Norway AS ("Spirit") with a third transaction anticipated to be executed imminently (collectively the "Farm-Ins" or the "Transactions"). As part of the financing of the Transactions, Longboat has also executed a NOK 600 million (£52 million) Exploration Finance Facility ("EFF") with SpareBank 1 SR-Bank ASA and ING Bank N.V.
Together, the Fundraising and EFF will enable Longboat to pursue a significant, near-term, low-risk exploration drilling programme on the Norwegian Continental Shelf across seven wells targeting net mean prospective resource potential of 104 MMboe and an additional 220 MMboe of upside and follow-on prospectivity. The first well in the programme is expected to spud in Q3 2021. A full list of the licences and working interests to be acquired are detailed below. The cost of the carry element of the Transactions is fully eligible for the Norwegian tax refund system reducing the net cost to Longboat to $7.8 million on a post-tax basis ($35 million pre-tax)."
The way I understand it is they will use the finance facility to pay for the drilling. So I think they should have a good amount of money spare.
Drilling in 3 weeks. Norway has got an excellent record for discoveries this year. Even with all the drilling I think they must be looking at acquiring at least a non operated share in some production. They raised 35m and are only using 7m for 7 drills (correct me if I'm wrong).
My opinion is it looks good. 4,100m of positive drilling with the average over 3g. They are spending $10m this year on exploration and they have said to expect more results over the coming months. The question is what kind of volume of gold reserves does this add to the mine plan.
Bought a chuck yesterday. Glad I did. Not sure how many companies I've seen with such low drilling costs (because of Norway's exploration policy obviously),.