Explorer and developer Madagascar Oil is seeking £50 million on AIM.
Explorer and developer Madagascar Oil is seeking $70 to $80 million (£50 million) on AIM to develop multi-billion barrel prospects.
The company, which boasts two heavy oil assets, Tsimiroro and Bemolanga, in the Indian Ocean republic with an estimated 2.1 to 3.9 billion barrels, as well as several exploration blocks, hopes to raise the money through brokers Mirabaud Securities and GMP Securities, with Strand Hanson as nominated adviser.
The planned issue is as yet unpriced, but advisers say it is likely to put a value of £250 to £300 million on Madagascar Oil, whose chairman and chief executive officer Laurie Hunter heads a team with heavy oil experience in California and Indonesia. The company holds 100 per cent of Tsimiroro, which it suggests could produce 87,500 barrels a day for 30 to 40 years, and 40 per cent of Bemolanga, where French oil giant Total not only paid £62 million for 60 per cent but will also bear all the project’s exploration and development costs.
Madagascar Oil, whose shareholders include US based Persistency Capital, says it expects first pilot production from Tsimiroro late next year, with the next key operational decision on Bemolanga likely in June. This should be one to watch.
