88 Energy confirms subscription deal with ELKO International
88 Energy (LON:88E) announced on Monday through an operations update that the company raised $6.48m of new capital as it made progress in the drilling of the Merlin-1 exploration well in Alaska.
The energy company confirmed a share subscription deal with ELKO International, a contractor in the live drill programme.
ELKO has agreed to buy 360m newly issued shares valued at 1.8 cents each.
88Energy confirmed that the price was marked at a 225% premium to a prior placing which ran in February.
88 Energy’s share price is up by 32.9% to 1.475p per share on early afternoon afternoon trading. This follows a recent surge in March which has seen the company’s share price rise from 0.49p per share to 1.475p in less than two weeks.
The news comes as the Merlin well is being drilled down towards its primary Nanushuk targets, according to the company’s update.
Dave Wall, managing director of 88 Energy, commented in the impact of the ELKO deal on the company’s wider performance.
“The endorsement of the project by ELKO as we enter the critical phase of the drilling is encouraging and will serve to fund the Company’s share of the recently announced cost overruns.”