02/08/2012 - 15:46

Oilex to raise $7m for Indian project

02/08/2012 - 15:46

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Oilex to raise $7m for Indian project

Oilex has launched a $7.09 million capital raising plan to fund drilling at its Cambay oil and liquids project in Gujarat in India.

The company announced a 2-for-5 entitlement offer today, priced at 7 cents per share, to raise the $7.09 million.

Patersons Securities acted as lead manager to the offer.

Oilex said the proceeds would be put towards the drilling of high-impact offset well Cambay 76-H, conducting flow tests, and for general working capital.

Managing director Bruce McCarthy said previous results from the Cambay well had given the company confidence the wider project would be successfully developed.

“While mechanical problems were experienced during milling operations on this proof of concept well, precluding a flow test, these have not downgraded the value of the project in any way,” Mr McCarthy said.

“The funds that will be raised will enable the company to drill an offset well to obtain the remaining reservoir flow data that it requires in order to bring the proof-of-concept phase to a conclusion and assess the commercial viability of the very substantial volumes of hydrocarbons in the X and Y Zone tight reservoirs.”

Oilex stocks were steady on the ASX today at 9.1 cents.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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