Challenger Energy Group has secured £3.3m funding to develop their Uruguay prospects and operations in Trinidad.
Challenger Energy Group has established a convertible loan note facility of £3.3m of which £550k was initially drawn.
The primary use of the facility will to be develop Challenger’s OFF-1 and OFF-3 block offshore Uruguay. The results from the AREA OFF-1 work program have been extremely promising, in that the company now has a technically supported prospect inventory of between 1-2bn barrels in that globally attractive exploration hotspot.
Challenger Energy’s neighbours in Uruguay include majors Shell and Total. Shell has the block adjacent to OFF-1 and has substantial operations offshore Namibia which shares geological similarities with Uruguay.
“In the last year, across the broader Challenger Energy business, we have completed value-enhancing technical work, improved production operations, high-graded our portfolio, secured new assets, and ensured a range of options are available to deliver additional funds into the business,” said Eytan Uliel, Chief Executive Officer of Challenger Energy Group.
“Progress has been substantial, but the timing of when we need to spend and when we will see cash inflows is not always within management’s control. We have therefore now taken steps to ensure that we have flexible additional funding available, if and when needed, so that we can press on with accelerating new licences and high prospect business development opportunities in both Uruguay and Trinidad. In the current market we see benefit in having an established facility in place, even if we ultimately do not use it all.
“Personally, I am excited with how Challenger Energy is now poised – a honed portfolio, a clear focus on those assets which are world-class and have the potential to deliver a major value uplift in the near term, and the financial flexibility to take disciplined portfolio decisions when opportunity presents. Day by day I believe we are creating intrinsic value which I strongly believe will ultimately be rewarded, and which is why I am increasing my personal holding in the Company at this time. I look forward to sharing news of continued progress with fellow shareholders over the coming months.”