Maverick Drilling & Exploration (ASX: MAD) has received strong support from institutional and sophisticated investors with its A$50 million fully underwritten share placement closing well oversubscribed.
Settlement of the unconditional tranche of 24.5 million shares priced at A$1.02 each, or a 13.6% discount on the closing price of A$1.18 on July 17, will take place on July 26, while shareholder approval will now be sought on August 30 for the second A$25 million tranche.
Together with its existing cash in hand, the raising gives Maverick A$70 million to fund drilling of about 100 in field development wells in Texas to increase production as well as 66 wells targeting high impact targets identified by 2D and 3D seismic over the next 12 months.
The funds will also be used to finalise the completion of its seismic surveys, further equipment purchases, land acquisitions, general corporate purposes and offer costs.
The high impact wells consist of 56 wells targeting new oil prospects at depth of up to 10,000 feet and another 10 wells targeting prospects deeper than 10,000 feet.
If successful, these reservoirs have the potential to increase both production and reserves. These targets could result in wells capable of producing oil at rates many times higher than the in-field target average of 25 barrels per day.
Maverick already has three rigs drilling in-field wells at the projects and is bringing a fourth rig into play.
It is also fitting two of its rigs to test deeper targets, such as the new reservoirs. These rigs are expected to be deployed in the fourth quarter of this year.
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