i3 Energy in fundraise for North Sea development

UK independent i3 Energy has made progress with multiple funding options to finance its Liberator field development located in the UK North Sea. 

i3 Energy has been progressing multiple funding options to finance its 2018 development program and is in advanced discussions with multiple industrial parties regarding potential JV arrangements relating to both its 100% owned Liberator oil field and its application within the UK’s 30th Round, the company said in a statement on Wednesday.

Pursuant to these discussions, the company said it has received indicative commercial interest from a counterparty to provide 100% of the funding for a multi-well development on Liberator and the company’s 30th Round application block, amounting to estimated total capital commitments of approximately $200 million.

JV discussions have reached a mature stage and, should these commercial arrangements conclude in an expected six to eight weeks timeframe, the company would maintain a working interest of no less than 67% in its Liberator and 30th Round application blocks, after a multiple of the capital commitments have been refunded to the parties from post-production cash flow.

The Joint Venture discussions also contemplate capital being provided to i3 by an industrial party to enable the Liberator development to proceed utilizing that party’s funding alongside other credit facilities, even in circumstances where the company is unsuccessful with its 30th Round application.

However, there can be no certainty that these negotiations and discussions will lead to definitive agreements, the company noted.

i3 raises over $3.6M

The company has raised £2.57 million ($3.65 million) through the placing of 8,563,630 new ordinary shares in the capital of the company to new and existing investors at an issue price of 30 pence per share, representing a 0.4% premium to the 30-day average for the week ending January 26, 2018.

The proceeds of the funding will be used towards prerequisite engineering, trees and wellheads for the Liberator development, and general corporate purposes.

Liberator Field Phase I

Following i3’s submission of the Liberator Phase I Field Development Plan to the UK Oil & Gas Authority on September 15, 2017, the company commissioned AGR TRACS International Limited to prepare a Reserve Report (RR) over the Liberator field for the gross reserves that are expected to be developed and produced subsequent to the approval of the Phase I Field Development Plan.

The Liberator field is planned to be developed via two horizontal producers in Phase I, targeting the Main and Northwest culminations of the Phase I area. The field will be tied into the Repsol Sinopec-operated existing Blake field ‘host’ infrastructure and produced through the Bluewater-owned Bleo Holm FPSO.

A separate potential future Phase II plan is contemplated and may include further development wells, yet these potential reserves are not reported within the RR.

30th Round license application

The company has targeted and extensively evaluated seismic and well data on a highly attractive region of acreage that if awarded to i3 would add to the company’s portfolio 2C Contingent Resources of 22 MMBO (with 63% chance of commerciality) and Prospective Resources Best Estimate of 47 MMBO (with a 51% chance of commerciality), according to AGR.

The 30th Round application has been submitted to the UK’s Oil and Gas Authority with work program commitments totaling $13 million.

Neill Carson, i3’s CEO, commented: “We have been incredibly busy progressing multiple funding options for both our 100% owned Liberator development and the low risk development growth opportunity we have applied for in the 30th Round.

“There is strong momentum within the company and today’s funding strengthens our financial position allowing us to continue our engineering plans for our Liberator development ensuring the company is ready for the next operational stage of the project.”

Graham Heath, i3’s CFO, commented: “This fundraise enables the company to quickly advance key initiatives and procurement for our Liberator development, in addition to funding engineering activities that we believe will assist in concluding a successful joint venture in the near future.”