Investors back ADX with $1.5m to support Austrian oil and gas exploration and development programs
Link copied to
Investors have demonstrated their support for ADX and its ongoing drilling and development activities in Austria by providing $1.5m in loan note funding.
Proceeds from the loan note, which has a term of 18 months and is provided by supportive existing investors and new sophisticated investors, will be used for well equipment and well site preparations for drilling up to four development and exploration wells in Upper Austria.
ADX Energy (ASX:ADX) will also use the funds to cover engineering and procurement for the installation of a permanent production facility at the Anshof well site, which will remove current constraints on production imposed by the current use of a leased early production system.
The Anshof-3 well currently produces at a constrained rate of 120 barrels of oil per day.
“The funding, which has been secured on favourable terms, enables the company to continue its important pre-investments in equipment and services for upcoming exploration and development drilling programs as well as engineering and procurement for the replacement of a leased early production unit with a permanent facility at the Anshof well site,” executive chairman Ian Tchacos said.
“Providing a permanent production facility for the Anshof-3 discovery well, which continues to outperform expectation, and two planned appraisal and development wells at the same location will enable the rapid build-up of cash flow from the Anshof field.”
ADX is seeking to increase production from its fields in the Vienna Basin and the Anshof field in Upper Austria as well as undertaking further exploration in its opportunity rich Upper Austrian exploration portfolio.
Proceeds from the loan note will enable pre-investment in the drilling and tie-in of the Anshof-2 and Anshof-1 appraisal wells, which are expected to deliver production of about 300 bpd of oil each.
It will also enable drilling of the Welchau-1 gas exploration prospect and a further gas exploration well.
Welchau-1 will test the giant Welchau gas prospect in Upper Austria, which could host 651 billion cubic feet (Bcf) of gas and 26 million barrels of condensate.
A potential target for the remaining gas exploration well is the 37.8 Bcf IRR-1 gas prospect or a number of new shallow gas prospects in the ADX AT-I licence.
This article was developed in collaboration with ADX Energy, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.