AFR: Blue Energy in $10m placement

Oil and gas explorer Blue Energy is raising $10 million in a placement run by MST Financial Services and Petra Capital.

The offer of 199 million shares in total was priced at of 5¢ per share.

This is a 20.6% discount to Friday’s close, according to terms sent to investors on Monday morning.

Blue Energy plans to use the money for appraisal drilling and associated production testing in its North Bowen Basin assets to build 2P reserves base and to move gas supply heads of agreements to binding gas sales agreements, which it says will underpin pipeline construction.

It will also use some of the proceeds for seismic studies and working capital in the Northern Territory, the term sheet said.

The book closes at 3pm today.

MST and Petra Capital are acting as joint lead managers.

Blue Energy’s shares will remain in a trading halt until Wednesday.

Any oversubscriptions to the $10 million offer will need to be approved by Blue Energy’s annual general meeting slated for November 9.

Blue Energy is also open to raising up to a further $1 million via a share purchase plan to eligible shareholders, at the same price as the placement.

Source: The Australian Financial Review