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Lansdowne Oil & Gas shares rise as explorer raises funds at a premium

Last updated: 22:00 10 Mar 2015 AEDT, First published: 23:00 10 Mar 2015 AEDT

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Lansdowne Oil & Gas (LON:LOGP) shares gained 8.5% as the Irish explorer revealed a premium priced share placing.

It is raising £1.04mln with the issue of 20.7mln new shares to new and existing investors at a price of 5p.

The equity placing is further bolstered by a £1.8mln issue of loan notes to its principal shareholder LC Capital Master Fund, which is also participating in the placing and will own 28% of Lansdowne’sshares.

SeaEnergy (LON:SEA) did not participate in the share placing and as a result its stake in Lansdowne reduces to 18.7%.

Lansdowne said the injection of capital will allow it to meet existing liabilities - including a payment to TransOcean relating to a legal settlement - as well as providing working capital whilst it awaits the completion of a farm-out deal for the Barryroeproject.

“The purpose of the placing is to raise proceeds sufficient to fund the company's existing liabilities, including the Transocean settlement costs, and ongoing working capital requirements to the end of 2015,” the company said in a statement.

Lansdowne told investors it is hopeful of concluding the proposed Barryroe farm-out, which it anticipates will bring in funding for the company.

Providence Resources (LON:PVR), Barryroe's operator, last month revealed a deal had been agreed for the project subject to the proposed new partner securing financing. The identity of the new partner was not disclosed, nor were the deal terms.

The loan note is for one year and it carries interest at 10%.

On AIM, Lansdowne shares advanced 0.38p, 8.5%, to trade at 4.75p each.

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