Anglo African Oil receives commitments to raise £8.25m

Independent developer Anglo African Oil & Gas has received commitments to raise up to £8.25m through the issuance of new ordinary shares at a price of 5.2p each, it announced on Wednesday.

The AIM-traded firm said the fundraising would provide it with the funds required to re-enter the TLP-103C well at its Tilapia field in the Republic of the Congo, with a view to producing oil from the Djeno horizon.

It said the fundraising consisted of a commitment from existing institutional investors in the company to subscribe for 52,288,347 ordinary shares by way of a placing at the issue price.

The fundraising also consisted of a signed term sheet between Anglo African and European High Growth Opportunities Securitization Fund, under which the investor would subscribe for no less than 106,331,011 new ordinary shares at the issue price.

Under the term sheet, the proceeds of the subscription would then be applied towards the entry into an equity sharing agreement.

The fundraising and issuance of the placing shares and subscription shares remained subject to finalisation of binding legal documentation between the company and the relevant investors, the board explained.

Additionally, it said the fundraising shares were the only shares that would be issued in connection with the fundraising, and were all being issued at the same price, with no convertible instrument, warrant or option being issued.

It said it intended that the issue of the fundraising shares would be made from the authorities already granted to directors at the annual general meeting on 28 June.

The company said it had “every confidence” of completing the fundraising.

“It has been our goal since inception to produce oil from the potentially prolific Djeno horizon,” said Anglo African executive chairman David Sefton.

“Technical analysis of the well data and the oil that has subsequently come to surface has led to a revision of the operational plan such that we will now re-enter the Djeno in 103C and seek to produce from it.

“Once completed, this fundraising will enable us to achieve this.”