Oilex has announced plans to raise approximately $9.1 million via a conditional share placement to sophisticated and professional investors in the UK.
In a statement to the Australian Securities Exchange Oilex said it would place 30 million new ordinary shares at a price of 20 pence each, which is about 12 per cent of the enlarged share capital of the company.
Oilex is jointly listed on the ASX and the Alternative Investment Market.
Ambrian Partners Limited is acting as broker to the Placing.
"The net proceeds of the Placing will be applied primarily to further drilling on the Cambay Production Sharing Contract "tight" Eocene reservoirs in Gujarat, India, and for working capital," Oilex's statement said.
"Over the past 12 months the Company has made significant progress in unlocking the potential of the Cambay "tight" Eocene reservoirs that extend over the 160km2 contract area," said Oilex managing director Bruce McCarthy.
"Key to the success has been applying leading-edge North American tight reservoir industry expertise in assessing the contract area's reserves and resources.
"Oilex will be applying horizontal drilling and multi-stage fracture stimulation technology to improve flow rates and confirm commerciality of the Eocene tight reservoirs.
"The placement announced today will assist in providing funds to drill a further 2 wells to assess reservoir quality and distribution after the Company's initial proof-of-concept well in the Cambay contract area," said Dr McCarthy.
Oilex went into a trading halt on December 9 pending the announcement.
