News blog

Enegi Oil

• BY: Andrew Hore |
• POSTED: 29/08/2014 |

Enegi Oil says that the field development programme (FDP) for the Fyne field will not be completed by the end of August. 

Antrim Energy holds the licence for the Fyne field, which was classed as a marginal field and would not have been exploited without the buoy technology that Enegi uses. Antrim and ABT Oil & Gas, which is 50%-owned by Enegi, would be partners on the Fyne project. The self-installing floating tower (SIFT) technology has been advanced by the assessment of the field. Antrim is talking to the Department of Energy and Climate Change about the extension of the licence terms.

Despite these delays, Enegi believes that using the technology to exploit marginal fields should be the focus of the company.

The 50/50 joint venture ABT Oil & Gas was set up with ABTechnology, which has developed the buoy technology that lowers capital and operating costs and reduces decommissioning liabilities. Enegi says that it is considering buying out its partner in the joint venture.

In February, Enegi raised just over £2m at an average share price of 8.07p a share from Yorkville. However, Enegi entered into an equity swap with Yorkville. The 12 month swap is for £41,667 a month and the benchmark price is 8.88p a share. The share price has not been that high since the end of February and that means that the money received each month will be reduced by the percentage below the benchmark price the relevant share price is. If the share price is higher than 8.88p then more than £41,667 can be raised. That does not look likely. This means that Enegi will raise a lot less than £500,000 over the 12 month period. The current share price is 3.75p, down 0.38p. 

Enegi is considering an offer for part of its interests in Newfoundland but no contract has been agreed and due diligence is required. Whether this will involve a cash or shares payment is unclear. 

Download the latest AIM Journal from http://www.hubinvest.com/AIMPDFAugust2014_59.pdf