Otto to raise $11m in placement for Philippines exploration

West Perth oil and gas exploration firm Otto Energy Ltd will raise $11 million through a placement to fund ongoing exploration and development of its Philippines assets, the company has announced.

The full text of a company announcement is pasted below

Otto Energy Limited (ASX: OEL) is pleased to advise that it has reached agreement with Max Capital Pty Ltd and Patersons Securities Limited ("Joint Lead Managers") for the placement of 36.73 million Shares to be issued at price of $0.30 per Share to raise $11.02 million as follows:

• 25.9 million Shares at 30 cents per Share to raise $7.77 million will be issued immediately under the Company's 15% capacity, pursuant to ASX Listing Rule 7.1; and
• 10.83 million Shares at 30 cents per Share to raise a further $3.25 million will be issued subject to shareholder approval. A Notice of Meeting in this regard will be sent to Shareholders shortly.

The Joint Lead Managers have completed a heavily subscribed book build exercise; pursuant to which 36.73 million shares will be allotted to clients who include new international and domestic institutional investors.

The proceeds of the Placement will allow Otto to aggressively pursue its ongoing exploration and development of its Philippines assets, so as to:

• Finalise Otto's 2D/3D seismic programme in offshore Philippines licences at increased equity position;
• Interpret and process the seismic data; with a view to farming out the projects in late 2007
• Meet payment obligations under its bare boat charter for a multi-purpose semi submersible drilling and production rig for Philippines; and
• Meet obligations in respect of other long-lead items for Otto's Philippines exploration and development projects.