Norwest has completed a successful bookbuild to raise $2 million (before costs) through a placement of shares to a range of sophisticated and institutional investors, including major shareholders, to fund drilling costs of the Lockyer Deep-1 exploration well in the Perth Basin.
Norwest’s has a 20% interest in Lockyer Deep-1 , located on EP368 on trend with three significant recent discoveries, for which drilling is targeted during the first half of 2021.
Norwest said funds will also be allocated towards planning and preparation for a 3D seismic survey across EP368 and EP426 (post drilling of Lockyer Deep-1), desktop studies on exploration permit TP/15, and general working capital.
Norwest Managing Director, Iain Smith commented “We are pleased to have completed this capital raising and appreciate the support of our major shareholders. The company is now in an excellent financial position as we prepare to drill the Lockyer Deep gas prospect, which comes on the back of three very significant and valuable Permian discoveries. While discussions regarding timing of a rig slot continue, we remain optimistic of drilling during H1 2021.”
Major shareholder participation
Support for the placement includes Norwest’s top three shareholders; Mineral Resources Ltd (holding c.17.0%), 3C Group IC Limited (holding c.7.8%), and Sundowner International (holding c.5.7%).
The placement will result in the issue of 333,333,340 new fully paid ordinary shares at an issue price of $0.006 per share and is not subject to shareholder approval (falling within the Company’s 10% placement capacity under ASX Listing Rule
Norwest said the Lockyer Deep-1 well location has been selected to test a very large, fault-closed three-way dip structure at the Kingia and High Cliff levels within the Permian gas play’s “sweet spot” and on trend with three significant recent gas discoveries at Waitsia, West Erregulla-2 and Beharra Springs Deep. Strike Energy’s West Erregulla-3 target was recently suspended after encountering high pressure gas above the target interval.
The Geological Chance of Success (GCoS) for Lockyer Deep-1 is estimated by Norwest to be 38%.