Energy company, Eon NRG Limited (ASX: E2E) is involved in the exploration of high impact value add resources in North America. The company’s Oil and Gas division owns and operates producing oil and gas fields in the onshore USA and its battery Minerals Division is in the early stages of development, focused on the onshore USA at this stage.
Recently in the December quarter, the company finalized the acquisition of 15,000 acres in the Powder River Basin (PRB), and it is now focused on the development of the PRB Project. PRB Leases are surrounded by developed oilfields which have long lived production and the potential drill prospects at PRB will target oil from multiple formations including the Turner, Dakota and Minnelusa.
To raise capital for the development of PRB Project, the company has recently announced a pro-rata renounceable entitlement offer of new Eon ordinary shares on the basis of 1 New Share for every existing share held as at the record date of 7.00 PM (AEDT) on 11 February 2019 to raise up to approximately A$2.845 million (before costs). The Offer is partly underwritten by the lead manager, CPS Capital Group for $1.2 Mn. The group has lodged the Prospectus of the Entitlement Offer on 6 February 2019 with the Australian Securities and Investments Commission (ASIC), in relation to an offer of approximately 406,389,160 new shares at an offer price of $0.007 per Share to raise around $2.845 Mn. The closing date for the acceptance is 28 February 2019 and it is expected that the share will be started normal trading on ASX on 7 March 2019. As announced on 15 February 2019, the company has already dispatched a copy of the prospectus and a personalized Entitlement and Acceptance Form in relation to the entitlement offer, to Eon shareholders with registered addresses in Australia and New Zealand who held Eon shares as at the record date of 7.00PM (AEDT) on Monday, 11 February 2019.
As per the prospectus, from the total proceeds of the offer, $170,000 will be used for well-permitting costs, $2,505,000 will be used in working capital including well drilling costs, and rest $170,000 will be used for the costs of the Offer.
Recently in the December quarter of 2018, the company reported solid oil and gas production with total barrels of oil equivalent of 49,078 (BOE) with an average of 533 BOEPD.
For the December quarter, the company reported net cash outflow from operating activities of A$172k, net cash outflow from investing activities of A$223k and net cash used in financing activities of A$42k. As at 31 December 2018, the company had cash and cash equivalent of A$1.655 million.
Now, let’s have a quick look at the Eon NRG Limited’s stock performance and the return it has posted in the last few months. E2E’s shares traded at $0.007 with the market capitalization of ~$5.69 Mn as on 25 February 2019 (AEST 4:00 PM). The stock has provided a YTD return of -1.56% & also posted returns of 12.50%, -58.55%, -53.68% over the past six months, three & one-months period respectively as on 22 February 2019. It had a 52-week high price of $0.031 and touched 52 weeks low of $0.004, with an average volume of ~7,772,757.
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