Kinetiko to raise $2.2m through placement to fund commercialisation of Mpumalanga gas projects
ASX-listed Kinetiko Energy has received firm commitments from professional and sophisticated investors to raise up to $2.2-million through the placement of more than 55-million new fully paid ordinary shares in the company at an issue price of $0.04 each.
The funds raised will be used for commercialising the company’s advanced shallow conventional gas projects, in Mpumalanga, South Africa.
The placement was not underwritten and was strongly supported by the largest shareholders and directors.
As such, the company’s directors subscribed for 7.75-million placement shares, representing a contribution of about $310 000.
The placement will be completed in two tranches. The first will consist of the issue of about 47.3-million placement shares to unrelated placement participants, while the second will consist of the issue of the director placement securities.
Kinetiko also negotiated a debt conversion of a loan in the amount of $500 000 through the issue of new fully paid ordinary shares on the same terms as the placement.
“The next valuable milestone is establishing through production test wells drilling commercial gas flowrates and depletion curves. This funding supports the production test well currently underway at the Brakfontein site, with initial results expected to be delivered in July.
“The company continues to grow its technical knowledge in this unique geological setting and engage global oil and gas experts and is extremely confident the next production test wells will be successful,” Kinetiko executive chairperson Adam Sierakowski said on June 12.
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