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Tlou Energy launches £3.2m fundraiser
AIM-listed coal power development company Tlou Energy announced its intention to raise up to £3.2m via an entitlement offer on Wednesday, shortly after successfully wrapping up the placement of 24.75m new ordinary shares that saw the firm pocket £1.4m to cover costs associated with drilling and regulatory expenses associated with its Botswana and Southern Africa projects.
Tlou's entitlement offer, which was partially underwritten, would entitle each eligible holder to acquire one fully paid ordinary share for every six existing ordinary shares held as of 15 June at an issue price of £0.0575, a discount of 26.8% to the closing mid-market price of its shares on 5 June.
Managing director, Tony Gilby said, "This placement provides significant momentum for Tlou to progress the Lesedi CBM Project with the objective of supplying the first gas-fired power in Botswana. We were very pleased with the introduction of a number of new investors to the Company along with continued support from existing shareholders in Australia and the UK."
Tlou intends to use proceeds of the placing to drill production pods at its Lesedi CBM project in the second half of 2018, with dewatering to be completed prior to production testing, and with installation and commissioning of power generation facilities planned for 2019.
Funding has also been put aside for further core-hole drilling operations, using a core-drilling rig recently purchased by Tlou, in order to upgrade existing data control on the project and aid further reserves and contingent resources expansion.
"With off-take negotiations progressing very well, reinforcing the company's confidence of securing an agreement, and regulatory requirements also on track, a successful drilling program would see the company firmly on target towards getting first power into the grid as soon as possible," Gilby added.
As of 1200 BST, Tlou shares had tumbled 23.57% to 6p.