Azonto plans $24m Canadian farm-in

Junior explorler Azonto Petroleum has announced plans to farm-in to an oil and gas project in Canada through the acquisition of one of the project’s joint venture partners, which is owned by Perth executive Alan Stein.

Subiaco-based Azonto announced today it would issue 28.5 million shares to wholly acquire Calima Energy, a wholly-owned subsidiary of Havoc Partners and a 4.5 per cent joint venture partner in the Montney project in Canada.

It will also issue about 20 million performance shares, subject to the achievement of certain milestones.

At Azonto’s share price of 1 cent, the deal is worth about $485,000.

Azonto also plans to spend up to $C25 million ($A24.4 million) to earn up to a 55 per cent stake in the Montney project over three years.

As part of the Calima acquisition, Azonto will be required to comply with ASX re-listing rules, and so plans to undertake a $4.5 million capital raising priced at 4.5 cents each.

Calima representatives Mr Stein and Jonathan Taylor will join Azonto’s board as managing director and technical director respectively, while Havoc team members Richard Higgins, Justin Norris and Mark Sofield will joint Azonto’s managmeent team, initially as consultants.

Existing Azonto chairman Glenn Whiddon will remain in his current role, as will non-executive director Neil Hackett.

Rob Downey, Azonto’s only other director, will resign from the board.

Azonto also plans to change its name to Calima Energy upon re-listing, which it hopes to achieve by mid-July.

The company will also undertake a one-for-three consolidation of its share capital.

Upon re-listing, Azonto has estimated a market capitalisation of $22.1 million.

Euroz is acting as lead manager to the raising.