Austin Exploration (ASX: AKK) is an oil and gas development company with assets in Australia and the United States.
Austin Exploration (ASX:AKK) has raised about A$20 million to carry out drilling and completion activities at its Eagle Ford Shale and Niobrara Shale projects in the U.S..
This will allow the company to properly evaluate and progress development of its assets and contribute to the transformation of the company into an onshore U.S. producer of oil and gas
Austin will use the proceeds to drill and complete 2 vertical wells at Eagle Ford and complete a recently drilled well there.
This will be followed by the drilling and completion of the most prospective vertical well as a horizontal well.
Austin will also drill and complete two horizontal wells in the Niobrara Shale and one well at its Mississipi Wilcox project.
The company has a 85% working interest in the 46.8 square kilometres (11,560 acre) Niobrara project in Fremont County, Colorado; a 93.5% working interest in the 20.2 square kilometre (5000 acre) Eagle Ford project in Burleson County, Texas.
In the Eagle Ford, Marathon Oil (NYSE:MRO) has flagged a massive drilling program while Sun Resources (ASX:SUR) has been building up acreage for its Delta Oil project.
Meanwhile, Chinese giant Sinopec had last month invested US$2.2 billion (A$2.06 billion) in 5 U.S. shale blocks held by Devon Energy, one of which is the Niobrara.
The placement of about 690 million shares priced at A$0.029 each to domestic and international institutional and sophisticated investors was heavily oversubscribed.
Every 2 shares placed also comes with a free attaching option that is exercisable for a share at A$0.055 and expires on 6 July 2013.
Austin will also launch a separate shareholder share purchase plan to raise up to A$5 million.
Shareholders registered on 20 February 2012 will be able to subscribe for up to $15,000 in new shares priced at A$0.029 each.