Cluff Natural Resources raising £2m in placing and subscription

Cluff Natural Resources announced a placing and subscription of a total of 95,238,090 new ordinary shares on Wednesday, to raise a total of £2m.

The AIM-traded firm said all new ordinary shares were to be issued at a price of 2.1p per new ordinary share.

It said that, following the “highly successful” outcome from its applications in the UK's 30th Offshore Licensing Round culminating in the provisional award of 10 blocks in the Southern and Central North Sea, containing both oil and gas prospects, it had decided to raise additional funds to accelerate the evaluation and development of its enlarged portfolio of assets.

In addition to providing general working capital, Cluff said the proceeds of the placing and subscription would be primarily used to accelerate the technical and commercial evaluation of the additional Central and Southern North Sea oil and gas licences awarded in the 30th Offshore Licensing Round, and determine future drilling opportunities.

They would also be used to continue the process of seeking to secure farm-in partners or strategic investors to fund drilling on its existing licences P2248 and P2252; and to continue planning for a prospective multi-well drilling programme in 2019 on key exploration targets on existing licences P2248 and P2252.

The directors said they expected that the net proceeds of the placing and subscription would fund the company for a minimum of 12 months.

“Our outstanding result in the 30th Licensing Round exceeded even our own expectations,” said Cluff Natural Resources chairman Algy Cluff.

“The awards build on the company's core competencies focussed primarily on the Southern North Sea but also include blocks in the Central North Sea which contain oil prospects, further enhancing and diversifying our portfolio.”

“Due to the significant expansion of the size and nature of the company's portfolio of prospects, the board now has the opportunity to accelerate investment in the technical and commercial evaluation of both oil and gas prospects to create a significant pipeline of future drilling opportunities, while continuing its current process of securing partners for its existing licences to implement its planned drilling programme in 2019.”