News blog
Ssafen
- BY: Andrew Hore |
- POSTED: 18/07/2014 |
Oil and gas-focused investment company Ssafen is seeking to raise $3m prior to a proposed move from GXG to AIM.
Strand Hanson has been appointed as corporate adviser because of its expertise in sub-Saharan Africa and the plan is to raise between $20m and $50m when Ssafen joins AIM. The initial cash will be used to acquire interests in marginal oilfields in Nigeria. This appears to be a change in strategy in order to generate revenues earlier. These Nigerian assets would be developed with farm-in/farm-out agreements and, longer-term, there will be investment in Namibia and South Africa. Ssafen has previously committed to spend up to $10m on a Namibian CBM project, where it plans to acquire an 80% stake.
The most recent fundraising was at 15 cents a share, which values Ssafen at $8.48m.
Zirkie Louw has resigned as a director but she remains a shareholder. The current shareholder base is mainly made up of mining and resources professionals. Ssafen is run by its 50.8% shareholder Chris Eager, who was previously chief executive of South American copper miner Monterrico Metals and Asia Energy, now known as GCM Resources. Ssafen was originally known as Resmin when it joined the GXG First Quote on 15 April.
Resmin’s original strategy involved coal mining but finance was hard to come by and the focus was switched to CBM. Political uncertainty meant that Resmin decided to withdraw from the Discovery CBM project and change focus to a Namibian project.
An initial loan repayment of $500,000 by Discovery was due in May and another instalment of $400,000 is expected in November 2014. A $400,000 loan to Proxor, which relates to the original coal mining strategy, should be repaid in August and this is expected to spark the development of the Limpopo CBM project, where Ssafen expects to own 60%. Directors’ fees were not due to be paid until the initial Discovery loan repayment.
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