Sound Oil Completes Fundraising for Nervesa Appraisal Well

Sound Oil has announced that it has completed a second tranche of a private placement, securing the funds needed to complete the Nervesa gas appraisal well in Northern Italy. The second tranche is completed with Astin Capital Management Limited.

The second tranche furthers an initial tranche with Astin Capital, completed on 1 December 2011, which raised £2 million. This recent tranche, which involved the placement of 262,587,803 shares and 157,552,682 associated warrants, creates further funds of £4 million, bringing the total funds raised over two tranches to £6 million.

The money raised will now be used to finance the Nervesa gas appraisal well, a large gas discovery in Northern Italy. Sound Oil is a 100 per cent stakeholder in the Nervesa well, following the acquisition of Italian company Celtique Energy in November of last year. The Nervesa discovery is estimated to hold approximately 21 billion square cubic feet of gas with an independently assessed NPV10 success case of US$62 million.

"'I am delighted that we have secured these funds which allows us to get on with drilling the important Nervesa gas discovery in Italy where we are operator and have a 100 per cent holding," CEO and Chairman of Sound Oil, Gerry Orbell said. "We expect to drill this well in mid 2012 and have already advanced the procurement of long lead items and identified the drilling location.

"I am also very pleased that in these difficult financial times Astin and their own investors have shown great confidence in the Company's ability to deliver its objectives."