Loss-making Offshore Hydrocarbon Mapping (OHM) has exchanged £28 million of vessel charter liabilities for equity and is raising £2.6 million.

Loss-making Offshore Hydrocarbon Mapping (OHM) has exchanged £28 million of vessel charter liabilities for equity and is raising £2.6 million.

The Aberdeen-based company, whose remote electromagnetic sensing technology is used to find offshore oil and gas, has been hit by sharp cuts in exploration spending by oil and gas companies, and says it has agreed with Norwegian shipowner Seatrans to convert an existing day-rate contract for two vessels, the OHM Leader and the OHM Express, to a ‘pay-as-used’ revenue-sharing contract. This deal reduces AIM-quoted OHM’s commitments from £33 million to £5 million, comes with an extension of the charter from five to six years and is described by OHM’s directors as ‘of the utmost importance to the group’s continued survival’.

As part of the deal, OHM, steered by chief executive officer Richard Cooper, has agreed to pay Seatrans £3.1 million by issuing it shares at 21.52p – which compares with the 170p at which the company floated five years ago. In addition, OHM, which expects to show a virtually unchanged loss of £8.6 million to £8.8 million for the year ending this month, with cash down 80 per cent to £800,000, is raising £2.6 million with a placing, also at 21.52p, handled by broker and nominated adviser KBC Peel Hunt.