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Wednesday, September 16, 2020
Global Petroleum announced that it has successfully raised funding for its program offshore Namibia. The company plans to progress its work program over the PEL0094 and PEL 0029 areas.
Global raised £1,327,500 million in aggregate before costs through the Placing of 177,000,000 Ordinary Shares at a Placing Price of 0.75 pence per share. In addition, certain Directors of the Company intend to subscribe for, in aggregate, 9,666,667 Ordinary Shares, raising £72,500. In aggregate, the gross quantum of funds raised by the Placing and the Subscription will be £1.40 million.
As a further component of the Placing and the Subscription,186,666,667 Warrants are also being issued at an exercise price of 1.5p per share for a period of 2 years (one Warrant for every one new Ordinary Share). In the event the Warrants are exercised in due course in full, associated proceeds will be £2.80 million, with the result that the Company will have raised gross proceeds of £4.20 million at a weighted average price of 1.125 pence per share.
Rationale for the Placing
On 20 July 2020 Global announced an updated estimate of prospective resources for its license PEL0094, following its interpretation of the historic 3D seismic data over Block 2011A, which amounted to 687 MMbbl unrisked best estimate net prospective resources. It is the Company’s intention to seek a farm-in partner for exploration drilling on PEL 0094, and potentially also to progress the work program over the PEL 0029 area.
From a wider perspective, Namibia has seen multiple farm-outs or acquisitions completed since 2017 by companies such as Qatar Petroleum, Total, ONGC, Kosmos, and most notably Exxon. Moreover, there are reported to be several highly prospective exploration wells planned for the next 18 months, starting with Total’s Venus-1 well which is reportedly scheduled for Q4 2020.
Proceeds from the Placing and Subscription will provide in full the funds needed for the work commitments (firm and contingent) in PEL 0029 during the remaining period of the License, and in PEL 0094 for the forthcoming exploration period to September 2021.
The Company announced in April 2020 that it had made cuts in various categories of its G&A, notably the UK Directors agreed to reduce their annual remuneration by 25 per cent, effective 1 April 2020.
Admission of and Dealings in the Placing and Subscription Shares
Application has been made to AIM for the Placing and Subscription Shares, which will rank pari passu with existing Ordinary Shares, to be admitted to trading on AIM. Dealings are expected to commence at 8.00 a.m. on 30 September2020.
Following Admission, the total issued share capital of the Company will be 389,319,594 ordinary shares.
Peter Hill, Global Petroleum’s CEO, commented: “We are delighted with the investor response to this Placing, particularly given the uncertain economic climate, and would like to welcome new shareholders to the Company.
“The funds raised will enable us to undertake our planned work on our Namibian acreage, which was further de-risked following our recent re-interpretation of the historic 3D seismic on PEL 0094. We shall also renew our farm-out campaign at a time when we believe there is substantial interest in Namibia following the recent acreage acquisitions by majors and NOCs, as well as the upcoming wells.
“This is an exciting period for both Global and Namibia, and we look forward to providing further updates as we progress our work.”
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