Perth explorer Buru Energy has received a $20 million backing by Gordon Martin’s Coogee Chemicals in its $40 million capital raising to fully fund its 2015 work portfolio.
Buru said a placement of about 37.3 million shares would be issued at a price of 75 cents per share to eligible sophisticated investors and institutional holders to raise $28 million.
It represents a 2 per cent discount to the company’s closing price on September 17, just before it entered a trading halt.
Buru said it would also offer eligible shareholders the option to participate in a share purchase plan at the same price.
The share purchase plan has been capped at $12 million.
Following the completion of the placement, Coogee Chemicals will become a substantial shareholder in Buru.
“Our strengthened balance sheet will now allow us to pursue the substantial development opportunities, which we have before us, with confidence and determination,” Buru executive chairman Eric Streitberg said.
“The recent restructuring of the company’s management and our focus on strict cost controls will also ensure that we are able to deliver short and long-term value for shareholders.”
In the next year, Buru said it expected to further develop and upgrade its Ungani oil field and drill at least four oil and gas exploration wells.
Buru’s share price rose by 1.3 per cent to 77.5 cents per share at 2pm.