IGas Moves Toward Shale Program After Funding
UK exploration firm IGas Energy has successfully completed a share placing. A total of 24,330,730 new ordinary shares were sold at the placing price of 95pence (€1.14) with new and existing institutional investors, it said in a statement.
Platts reports the total value of the placing is £23 million (€27.7m).
The company wants to carry out a work program to study its onshore UK assets before agreeing to any deals that would bring in a partner on the acreage, which includes the Bowland shale in northwest England where Cuadrilla Resources is already active.
IGas plans to carry out a two-well shale appraisal program, which, including comprehensive data collection and a well flow test, could cost up to £15 million (€18m).
Reuters quoted the chief executive saying that the company has received interest from some of the oil industry's biggest names to look for shale gas in the UK.
Exxon Mobil was linked with IGas in December over a possible partnership. IGas has been running a process since June to find a partner to help it explore for shale gas at its licences in northern England.
"The kind of names that have been talked about in the market are the kind of names that we've seen interest from," said chief executive Andrew Austin. "It's more majors."
Referring to the British government's announcement last year of a new Office of Oil and Gas, and regulations to permit hydraulic fracturing, he said: "Positive support from the government has led to people's increased appetite to have a good look at what's going on."
Earlier today the company unveiled plans for a two well shale exploration programme in the UK. The company struck its first shale discovery last year, while drilling coal bed methane targets at the Ince Marshes project, in Cheshire.
The discovery was confirmed as being part of the Bowland shale basin – which is where Cuadrilla’s large discoveries of shale potential have been made.
IGas has been working on a possible farm-out of its UK shale acreage since the Ince Marshes discovery. It says the new work programme could "augment" the value of the group’s shale business, by appraising its significant shale resources.
IGas's biggest shareholder is Canadian oil and gas producer Nexen Inc which owns a 24% stake.