Oil explorers raise Sh284 million for domestic activity

Simba Energy and Pancontinental Oil and Gas, which are exploring for hydrocarbons in Kenya, have separately raised Sh284 million for use in local activities.

Simba Energy, which is Canadian-owned and listed on the Toronto Securities Exchange, raised Sh213 million ($2.1 million) in a private placement.

Pancontinental Oil and Gas – which is listed on the Australian Stock Exchange – raised Sh71 million ($700,000) in a placement targeting “professional and sophisticated” investors.

“Simba Energy has closed its previously announced non-brokered private placement to raise gross proceeds of $2,100,749 (the Private Placement),” said the company in an e-mailed statement.

The Canadian firm added that it planned to use the proceeds of the private placement to fund exploration commitments associated with its production sharing contracts in Kenya, and for general working capital.

Besides Kenya, Simba Energy has active onshore production sharing contracts (PSCs) in Guinea and has PSCs under continuing negotiation in Chad, Liberia and Ghana.

“Simba’s mission is to focus on onshore oil and gas potential in areas that are under-developed or not previously exploited,” said the company.
Pancontinental Oil and Gas said the funds would be used in conjunction with existing cash for exploration activities, business development, payment of expenses and general working capital purposes.

“Pancontinental Oil and Gas NL is pleased to advise that it has completed a bookbuild to raise $700,000 through a placement of 175,000,000 shares at an issue price of $0.004 per share to sophisticated and professional investors,” said the company.

Settlement or payment by those who took up the private placement is set for this week, March 24.

In Kenya Pancontinental has a 40 per cent interest in the offshore portion of Licence L6 and a 16 per cent free-carried interest in the onshore portion of Block L6.

With the fall of oil prices, companies in hydrocarbon exploration and even marketing have had to take the option of raising cash or selling stakes in order to continue being in business.