Prospex raises funds for Selva gas launch
Prospex Energy, a London-listed independent E&P company active in Italy, has secured £1.87mn ($2.3mn) in unsecured convertible loan notes to fund its path to first gas at the onshore Selva discovery in Italy's Po Valley.
The convertible notes will go toward Prospex's £2.3mn share of development costs. They carry a monthly compound interest rate of 12% and can be traded for equity at any time by the investor, at a conversion rate of 4.25p/ordinary share.
Prospex said July 25 it had tapped funds from existing and new investors for its Podere Gallina permit, which is being redeveloped as a low-risk, high-return project following its original 35-year stint producing gas under Italian major Eni's management.
Eni shut-in the Selva gas field in 1984. As of 2019, the area was estimated to contain a proven and probable reserve potential of around 13.3bn ft3, with daily output expected to reach up to 150,000 m3/d.
Prospex increased its stake in Selva from 17% to 37% in February, following a £2.2mn deal with former shareholder United Oil & Gas. The remaining 63% stake is held by Selva's operator, Po Valley Energy.
CEO Mark Routh said: "We are extremely pleased to have raised financing at this challenging time in the markets.
"The proceeds of the loan notes will be used to fund the Company's 37% share of the development costs at the Selva gas discovery on the Podere Gallina Permit in Italy and general corporate purposes. "
"We are experiencing significant increases in budgeted costs related to our planned development activity due to many factors including global supply chain complexity, increased costs of energy, materials and staffing all of which put pressure on schedule and costs."