Irish exploration firm Lansdowne Oil and Gas has shelved its sales process after the successful raise of £2.1m (€2.7m), allowing it to pay off debt and meet working capital requirements into next year.
Part of the money will go towards covering Lansdowne’s share of the money owed to drilling services firm Transocean, over a dispute relating to the Barryroe field in the Celtic Sea.
The remainder will cover Lansdowne’s working capital needs up to mid-2017.
Lansdowne is a 20% junior partner to Providence Resources at Barryroe. A recent Court of Appeal decision ruled that Transocean was owed $7m (€9m) by Barryroe’s operators.
Of that, Lansdowne is required to cover $1.4m.
Lansdowne has also said it has shelved initial plans for a sale of the company. Back in April, the Dublin-based company launched an all-options strategic review.
Yesterday it said, despite receiving “a number of indicative proposals”, none were received that represented the true value of the company’s assets.
“The board will continue to examine alternative means of enhancing shareholder value in the normal course of business,” the company said.
Another positive development for Lansdowne is that LC Capital Master Fund has agreed to convert a £930,000 loan note it held with regard to the company into new ordinary shares, meaning the fund will now own just shy of 29% of Lansdowne Oil and Gas.
LC is also extending repayment of the balance of the loan note until the middle of 2017.
Lansdowne also published annual results for 2015 yesterday, in which it reported an after-tax loss of £15.1m.
That figure was up from the £1.32m loss recorded in 2014 but included an impairment charge of £14.95m.
“Lansdowne does not trade and, as such, its results reflect only the cost related to group overhead and reduction of carrying value of prior exploration activity,” said Davy Stockbrokers’ Job Langbroek, who welcomed the funding news by saying it provides a “window of opportunity” for the company.
“The funding provides a lifeline to Lansdowne and the opportunity to participate in any value created by a successful farm-out of the Barryroe project over the next year,” Mr Langbroek said.
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