News Column

Lekoil Completes Placing To Help Fund Otakikpo Programme

May 21, 2014

Steve McGrath

LONDON (Alliance News) - Lekoil Ltd Wednesday said it had raised gross proceeds of about USD37.7 million, or GBP22.4 million, in the share placing it announced Tuesday that will help fund a work programme at the Otakikpo Marginal Field, offshore Nigeria.

In a statement, the company said it placed 33 million new shares, as it expected, at 67.75 pence each. Net proceeds are expected to be USD36.5 million, or GBP21.7 million.

Lekoil Tuesday bought a 40% participating and economic interest in the Otakikpo Marginal Field, in the eastern part of the Niger delta offshore Nigeria, from Green Energy International Ltd. It will pay up to USD11 million for the stake, and is also required to fund an initial work programme for re-entry of the existing wells and all costs until production starts, with a base case estimate of approximately USD67 million.

Lekoil expects to fund approximately 70% to 80% of the work programme through a reserve-based lending facility from domestic banks.

The placing was done via an accelerated book building, which means little or no marketing is done. Mirabaud Securities LLP and UBS Ltd acted as joint bookrunners and Ladenburg Thalmann & Co. Inc. acted as US placing agent.

Lekoil's shares were up 3.3% at 70.00 pence Wednesday.

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Source: Alliance News

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