A North Sea-focused oil and gas minnow has won a boost for its hopes of bringing a vintage field back into production.
Jersey Oil and Gas won a strong response from City investors to a fund-raising it launched to support work on plans to redevelop the Buchan field as part of a major new production hub in the Moray Firth.
Buchan was shut down in 2017 after 36 years in production. The firm that operated the field at the time , Repsol Sinopec decided it made economic sense to decommission the associated production facilities.
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In January Jersey said a study suggested Buchan could still hold 130 million barrels.
A £15 million share placing launched by Jersey yesterday was over-subscribed.
Chief executive Andrew Benitz said the company could use the proceeds to continue to develop its Greater Buchan Area (GBA) project at pace and progress its efforts to get firms to buy into the project through a farm-out process.
Aim-listed Jersey launched the farm-out amid a challenging period for the North Sea industry.
The plunge in oil prices triggered by the coronavirus crisis prompted some firms to slash spending in the area and left independents struggling to win backing from investors.
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However, the company has said that recent technical work completed on the GBA area has underlined the commercial potential of its proposed development.
Earlier this month it said the $1bn (£0.7bn) development could be expected to achieve payback in under three years.
The project would involve developing a new production facility to handle production from Buchan and two finds nearby.
Jersey Oil & Gas reckons the three fields contain around 170 million barrels oil equivalent.
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Subject to shareholder approval, Jersey will complete the placing at 165p per share. Shares in the firm closed up 18.5p at 181.5p, leaving it with a market capitalisation of around £40m.
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