New Zealand Energy Corp. (CVE:NZ) (OTCQX:NZERF) said late Thursday that it has agreed to a $35.1 million bought deal financing.
The agreement with Canaccord Genuity, on behalf of a syndicate of
underwriters, will see the purchase, on a bought deal basis for resale
to the public, of 11.7 million New Zealand Energy shares, at a price of
The company has also given the underwriters an over-allotment option
to purchase, on the same terms, up to an additional 1.755 million common
shares for another $5.265 million in proceeds.
The option can be exercised in whole or in part at any time up to 30 days after the offering closes.
The company said it will use the new funds to explore and develop its
oil and gas properties, as well as for additional geologic and
technical studies, and for other corporate purposes.
The closing of the deal is expected around March 21, 2012, subject to
all necessary regulatory approvals, including that of the TSX Venture
New Zealand Energy controls two permits covering 169,949 net acres in
the Taranaki Basin. The company achieved production in December 2011
from Copper Moki-1, its first discovery well in the Taranaki Basin, and
late last month, announced the start of an extended production test from
its Copper Moki-2 well and the start of drilling at its Copper Moki-3
The company also said in February that based on its early operational
success in the Taranaki Basin of New Zealand's North Island, it has
forecast an exit production rate of 3,000 barrels of oil equivalent
(boe) per day for 2012.
The company said the guidance was prepared on the back of production
results disclosed that week, as well as the planned drilling of eight
net additional wells this year.
The forecast also took into account the completion of a natural gas
pipeline, and the "continued performance in line with existing oil and
natural gas production" from its Copper Moki-1 and Copper Moki-2 wells.
At the Copper Moki-2 (CM-2) well, it is producing 42.0 degrees of API
oil, and is currently flowing at a rate of 1,000 barrels of oil per
day, and 820 thousand cubic feet (mcf) of natural gas per day, New
Zealand Energy said.