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Regency Mines raises money ahead of Horse Hill spud

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Regency Mines (LON:RGM) has brought in £327,100 via a placing ahead of the spudding of the Horse Hill-1 well near Gatwick airport, UK.

Proceeds will be used for exploration at Horse Hill and for working capital, the group said.

Regency will issue, in two tranches, around 116.8 million shares and convertible placing shares at 0.28p a share - around a 6% discount to yesterday's closing price of 0.30p.

Regency chairman Andrew Bell said: "The market has been expecting a placing of shares to fund our investment in the Horse Hill-1 well in Surrey which is expected to spud shortly.

"We felt that this expectation was holding us back and that it was best to eliminate any uncertainty by funding now."

Last week, Bell said the firm believed that it was one of the largest if not the largest UK onshore prospect to have been drilled in recent decades.

He added on Tuesday: "Our holdings in Ram Resources in Australia and in Alba Mineral Resources plc continue to perform well and are potential additional sources of further liquidity. We will continue to control costs and to negotiate with potential partners in relation to our nickel interests."

As reported in July, Regency will take a 5% stake in Horse Hill Development (HHDL), the special purpose vehicle set up to develop the UK project; HHDl has a 65% interest in the project and is the operator.

Regency directly will pay £300,000 in total, comprising £50,000 initially and the rest as cash calls are required for well drilling. After full payment, it will own a direct 3.25% of the PEDL 137 licence that includes Horse Hill.

The venture also features (as HHDL stakeholders) David Lenigas’s UK Oil & Gas Investments (LON:UKOG), Solo Oil (LON:SOLO), Stellar Resources (LON:STG), Doriemus (LON:DOR) and Alba Minerals (LON:ALBA).

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