SCOTTISH oil and gas explorer Bowleven said yesterday it needed more cash to progress exploration and development programmes in west Africa.
The Edinburgh-based company, which has extensive acreage in Cameroon and Gabon, said it was considering raising funds from shareholders, through farm outs, or debt, although chief executive Kevin Hart said market circumstances meant debt was an unlikely route in the short-term.
Bowleven said its proposal to raise capital had the informal support of several institutional shareholders who have indicated they will vote in favour of a resolution to be proposed at an extraordinary meeting in Edinburgh on December 11.
The resolution, if approved, will authorise the directors to offer up to 250million new shares in the company, which was valued at more than £111million yesterday after its shares rose 7.5p to 124p.
Mr Hart said there was interest from a few companies in farming into its licences in Cameroon, and Bowleven might approach others.
He added: “In exploration and portfolio development, Bowleven has had a highly successful year.
“Despite unprecedented turmoil and collapsing values in capital and commodity markets, the company’s asset base has never looked better.
“The key to realising value from our portfolio is access to capital.
“Even given the extreme environment, we remain confident we will be able to obtain the capital required to make substantial progress and create value for shareholders.”
Bowleven wants to raise capital among other things to drill further appraisal wells on its 100%-owned IE gas and condensate find and IF oil discovery offshore Cameroon, which have estimated recoverable reserves of 50million barrels of natural gas liquids and 40million barrels of oil respectively.
It also wants to progress an oil discovery on its EOV permit offshore Gabon towards development sanction.
Mr Hart said this field could come on stream by 2010 at an initial rate of 10,000 barrels per day.
Bowleven reported operating losses before taxes of £6.84million yesterday for the year to June 30, down from a £12.59million deficit the year before.