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Corcel PLC (LSE:CRCL) experienced a significant drop in share price, losing approximately 16% following the announcement of a £1.22 million equity raise, coupled with an increase in its exposure to Block KON-16 in Angola.
The company’s subsidiary, Atlas Petroleum Exploration Worldwide Limited (APEX), successfully raised its stake in the KON-16 project by 20%, bringing its total ownership to 55%. This increase in stake was made possible after a partner withdrew from the project, and notably, Corcel incurred no additional costs to secure this enhanced interest.
In conjunction with this development, Corcel completed a £1.22 million fundraising effort, which involved issuing 1.22 billion new shares at a price of 0.1p each. The proceeds from this equity raise are designated for ongoing operational activities in Angola and Brazil. The shares were acquired by a consortium of strategic investors who, according to Corcel, possess extensive experience in the oil and gas sector.
Scott Gilbert, the chief executive of Corcel, commented on the significance of the funding, stating that the backing from strategic investors with deep expertise in the oil and gas industry, particularly in Angola, validates the company’s strategic direction and serves as a solid foundation for sustainable growth.
Gilbert further elaborated on the company’s strategic focus, highlighting its commitment to three energy verticals: exploration, near-term production, and support for energy transition through its battery metals portfolio. He described the increase in working interest in KON-16 as a major milestone for the company. Gilbert emphasized that acquiring this larger stake without incurring costs showcases the innovative and value-enhancing opportunities the company consistently seeks. He expressed confidence in the project, identifying it as a leading contender in what he regards as the most promising onshore block in the Kwanza Basin, noting historical oil shows from wells drilled in the 1960s.
As of Tuesday, Corcel shares traded at 0.11p each, reflecting a decline of 16.46% in London. The combination of the equity raise and the strategic changes in project exposure illustrates the dynamic landscape within which Corcel operates, signaling both challenges and potential growth avenues in the evolving energy sector.
