Petroneft raises $2m in share placing for capital investment programme

Petroneft Resources has raised more than $2 million in a share placing, with the funds earmarked for its 2020 capital investment programme.

The company, which is the 50 per cent owner and operator of Licences 61 and 67 in the Tomsk Oblast, Russian Federation, said 107,755,037 shares were placed at a price of 1.5p with institutional and other investors. That represented a premium of around 58 per cent.

The placing received significant commitment from directors, the company said, who supported 44 per cent of the placing.

Some $1.6 million of the capital is new funding, with the remainder to settle outstanding salary to senior management and board director fees.

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Petroneft will hold an extraordinary general meeting in Dublin on January 7th to approve the capital raise. If that is agreed, and the application to both the London Stock Exchange and Euronext Dublin are successful, dealings in the placing shares are expected to commence on AIM and Euronext Growth on January 9th.

The company also said it had extended for a year the Petrogrand loan, which was due to expire on December 15th, and there is the potential to further expand it to December 15th 2021 if certain milestones are met.

"We are very pleased with the outcome of the Placing, especially as we successfully managed to place at a 58 per cent premium to the prevailing share price; this shows great confidence and support for the company," said Dave Golder, chairman of PetroNeft Resources. "In addition it is also very encouraging that we have managed to negotiate a loan extension with Petrogrand that enhances our financial flexibility and enables to invest in the ongoing improvement of our resource base and long term asset value."