TomCo raises extra funds through subscription, Red Leaf disposal

Oil shale exploration, development and technology group TomCo Energy has raised £0.1m through the subscription of 1,176,471 new ordinary shares of no par value with an existing shareholder, at a price of 8.5p share, it announced on Tuesday.

The AIM-traded firm had also agreed, conditional upon receipt of funds, to dispose of its entre interest in Red Leaf Resources for a total consideration of $0.13m.

Following delays in the development of Red Leaf's ‘EcoShale’ technology and Total E&P USA Oil Shale’s decision in 2016 not to proceed with its early production system, TomCo said it had made a full impairment against its interest in Red Leaf during the financial year ended 30 September 2017, and as a result, its interest in Red Leaf was held at nil.

Following the subscription and disposal, TomCo would have cash resources of about £0.34m, and thus would have sufficient funds to take it beyond the completion of the current field test on its Holliday Block in Utah, and through to late in the first quarter of 2019.

“The company will need to raise further funds for working capital, loan repayments and project development beyond that time,” the TomCo board said in its statement.