Oilex extends repayment on series D facility, raises another £0.35m

Oilex has entered into an amendment agreement to vary the repayment obligations for its series D loan funding facility of £0.23m, it announced on Monday.

The AIM-traded firm said that in addition, it had secured additional equity investment of £0.35m, to increase its working capital flexibility and reduce its financial debt obligations.

It said that under the amendment agreement with Lombard Bank, the loan repayment date on the series D facility was extended to 30 June from 31 March.

All other terms remained the same, with no fees applicable to the amendment, while the loan was currently drawn down to £0.19m.

On the equity capital raising, Oilex said it had arranged further funding of £0.35m with existing sophisticated shareholders through the subscription of 250 million new shares, at a price of 0.14p each.

The board said funds raised from the subscription would be applied towards increasing its working capital base, as well as debt reduction.

It said the funding would support its settlement with GSPC, which, as it announced on 15 February, it was in advanced discussions on.

Completion of the subscription was expected on 19 March.

Oilex said it had issued 4,642,858 new ordinary shares as consideration in lieu of fees payable to consultants, at the same price of 0.14p each.

“The company continues to advance discussions with GSPC to acquire GSPC's 55% participating interest in the Cambay PSC, albeit with some delays due to Covid-19 related impediments,” said managing director Joe Salomon.

“Additionally, Oilex has continued to advance negotiations with third parties to provide finance, including working capital, to Oilex for this acquisition.”

Salomon said the firm was working to complete those negotiations as soon as possible.

“We remain confident of a successful outcome and we thank our shareholders for their ongoing support and patience.”

At 0903 GMT, shares in Oilex were down 8.12% at 0.15p.