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April 6 (UPI) -- West African explorer FAR Ltd. said it raised substantial capital to fund its development programs in the emerging oil basin offshore Senegal. FAR placed 1 billion shares to institutional and other investors to generate around $60 billion in capital. The company said the proceeds would be used to fund drilling, evaluation and pre-development programs off the coast of Senegal, and potentially the acquisition of further assets off the Gambian coast.
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Trading for the general public is halted "until further notice," and the company said the shares it did release were discounted by 4.8 percent. With full underwriting, Managing Director Catch Norman said the evidence is there that FAR's portfolio is high quality.
"The cash raised is expected to fund FAR through the expected work program for 2017 and 2018 in Senegal," she said in a statement.
The SNE oil field met the minimum threshold to be considered a commercial opportunity by the third quarter of 2016, less than two years after it was discovered. By the company's estimates, more than 1.5 billion barrels of oil may be in basins off the coast of Senegal and the results from VR-1, its latest discovery in the larger SNE field, could lead to revisions in the reserve estimate.
Cairn Energy, which holds interest offshore Senegal with FAR Ltd., said appraisal data is promising so far.
"VR-1 is the sixth successful appraisal well on the SNE field and has encountered some of the best quality reservoirs found to date," Chief Executive Simon Thomson said in a separate statement.
When it was discovered in 2014, the SNE field was considered the largest oil discovery in the world. FAR said the inclusion of the VR-1 into the drilling program would have a minimal impact on funding for offshore Senegal.
FAR Ltd. last week brought the British subsidiary of China National Offshore Oil Corp. in as a mutually interested party for areas off the coast of Gambia and Senegal.
