NU-Oil and Gas said today it had raised £2.05million from a share placement to support its strategy of investing in stranded and marginal fields.
The company added it had raised a further £50,000 through the issue of new shares to a “long -term supportive shareholder”.
Manchester-based NU-Oil, previously Enegi Oil, is through its 50% stake in the Marginal Field Development Company (MFDevCo) part of a consortium that was set up to exploit oil and gas discoveries considered too small to be developed by conventional methods.
Alternative Investment Market-listed Nu-Oil has production and exploration licences in Newfoundland, Canada.
Announcing the results of its fundraising, it said: “Having repositioned its assets in western Newfoundland and following MFDevCo’s collaboration with COSL Drilling Pan Pacific Limited (a subsidiary of China Oilfield Services) in recent months, the company will continue to implement its stranded and marginal field business model.”
NU-Oil said the next “logical” step was the acquisition of a project.
It added: “The size of projects that are being targeted are such that significant due diligence and engineering work is often required.
“While a significant proportion of this has been de-risked through MFDevCo via its previously announced collaboration arrangements, the company needs to be sufficiently financially robust in order to ensure that it can manage all eventualities in the acquisition process as the directors expect success to be transformational for the company. ”
Chief executive Nigel Burton said the company’s first project would use “low-cost solutions” devised and delivered by MFDEvCo and the MFD Consortium.
A few years ago, Enegi was part of a joint-venture, alongside now defunct Aberdeen firm Advanced Buoy Technology, looking to develop difficult-to-reach reserves.
The partnership was based around the development of unmanned floating production buoys to access small, marginal oil and gas reservoirs.