(Alliance News) - Molecular Energies PLC shares halved following the announcement of a fundraise intended to support ongoing activities at its Paraguayan exploration project.
Molecular Energies, formerly known as President Energy PLC, is an Argentina and US-focused oil and gas production company. Shares in the company were down 52% at 35.30 pence each in London on Wednesday afternoon.
This followed an announcement outlining Molecular's intention to raise "at least" GBP500,000 through the placing of 991,851 new shares and a subscription of 436,714 shares at a price of 35p. This price represents a discount of roughly 52% to Molecular's closing mid-market price of 73.5 pence on Thursday.
The placing, for which Cavendish Capital Markets Ltd is acting as bookrunner, is conditional upon admission of the news shares to trading on AIM, expected to occur no later than January 26.
Proceeds from the fundraise will be used to provide Molecular working capital to advance its alternative energy division, Green House Capital Group PLC. The company intends to float GHC, in which it holds a 75% stake, in 2024.
Molecular also said it requires financing for its Tapir x-1 exploration well at the Pirity concession in Chaco, Paraguay. In January, Molecular confirmed the spudding of the well, believed to hold over 260 million barrels of Pmean unrisked oil resources. The company said it believes it "has the experience and contacts to monetise the opportunity quickly".
The company added: "[Molecular] has a proven track record of innovation and value creation through the implementation of new business lines. The net proceeds of the fundraising will allow the company to advance the many opportunities it is now seeing and to invest in the technical and other studies required to bring these to fruition."
By Hugh Cameron, Alliance News reporter
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