Petroneft raises $6.7m for Russian oil field plan
Petroneft Resources has raised $6.7m (€4.8m) to fund the development of its Russian oilfield as the company works to nail down a farm-out deal before April.
Some $5.2m was raised through a share placing, with some 62 million shares priced at 5p per share.
Another $1.5m was raised through a loan facility with Arawak Energy, by increasing an existing $15m loan to $16.5m on the same terms.
The proceeds will be used for the purchase and delivery of supplies and equipment to Petroneft's onshore field located at License 61 in the Tomsk Oblast, Russian Federation, which must be completed while winter roads are still passable if work is to continue as scheduled this year.
The funds will also be used for working capital requirements and the payment of $2.5m owed to the Macquarie bank. Petroneft is currently securing a farm-out deal for License 61 – if it is not completed by April 15, Macquarie has the right to ask for the licence to be put up for sale.
Production at the site is currently around 2,400 barrels of oil per day.
The company said its water injection programme continues to function effectively and overall well performance was in accordance with expectations.