(Updates with closing share price in second paragraph.)
Jan. 13 (Bloomberg) -- Falkland Oil & Gas Ltd., an explorer in the South Atlantic, declined after raising 48.5 million pounds ($74 million) in a share sale.
The stock fell 11 percent to 45 pence as of the 4:30 p.m. close in London. The company said today it sold 112,764,675 new shares at 43 pence each to expand its drilling program.
The company plans to start its drilling in four months on the southern side of the U.K. territory that Margaret Thatcher went to war to defend from Argentina in 1982. The new funds will allow the company to target additional reservoirs that may contain more than half of Loligo’s 4.7 billion-barrel resource potential.
“We are delighted by this show of support from new and existing shareholders,” Chief Executive Officer Tim Bushell said in a statement. “The additional funds will significantly increase our flexibility over the forthcoming drilling program expected to start in early May with the drilling of Loligo.”
Falkland Oil & Gas continues to seek partners for investing in the project to secure additional drilling funds. The company said it decided to sell additional shares because a deal was unlikely to be completed before the campaign started.
“The great thing about the fundraising is that it means we don’t have to bring in a partner before drilling starts,” Bushell later said in a telephone interview.
Oriel Securities Ltd. and Jefferies International Ltd. are joint bookrunners in the share sale. The placing hasn’t been underwritten.
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