25.05.2020

Byron Energy raises A$16m via Placement

We are pleased to announce that we have successfully advised Byron Energy (ASX:BYE) on its recent A$16m Placement and proposed A$4m Share Purchase Plan (SPP).

Byron is an independent oil and natural gas exploration , development and production business focussed solely on the shallow waters offshore Louisiana in the Gulf of Mexico and, since its 19 million barrels of oil (mmbo) discovery (gross reserves) on its SM71 lease in 2017( Byron 50% gross), has been a producer with revenue approaching US$40m in the 2019 financial year.

Byron recently made a more significant oil discovery with 17 mmbo of reserves and 13 mmbo of prospective resources (gross) on its wholly owned SM58 lease, the final stage of development of which will be funded by this financing.

We have worked alongside Byron Energy for the past 7 years, raising equity capital.

A$16m Placement

Henslow was engaged by Byron to advise on its A$16 million equity capital raising with the proceeds used to fund the final development phase of SM58 taking the SM58 G platform into production.

The Placement consists of 123 million ordinary shares issued at A$0.13 per share. In conjunction with the Placement, the Company is also undertaking a $4m SPP for existing shareholders.

Additional US$3.5m Promissory Note facility

In additional to the Placement and SPP, Crimson Midstream (a portfolio company of the global Carlyle Group) agreed to subscribe for an addition of up to US$3.5m in the form of promissory notes on the same terms and conditions as the existing US$15 million facility, with the option of up to $1mm of that to be provided in the form of equipment or vendor services applied to SM58 G platform and pipeline(s) installation.

“We are pleased to have received such strong support from new and existing shareholders and our lenders. This additional capital will allow us to complete the development of our SM58 oil and gas project, including the completion of SM58 G1 discovery well, with production and cash flow expected to commence in September 2020. A$16 million in placement funds, US$3.5 million in additional loans from Crimson Midstream and the SPP funds will put us in a stronger financial position and allow us to maintain momentum at SM58 notwithstanding the oil price shock and the COVID – 19 restrictions. Successful development of SM58, where we hope to commence production in September 2020, will enable us to continue executing our focused growth strategy, designed to build a successful exploration and production company operating on the shelf in the Gulf of Mexico..” Maynard Smith, Byron’s CEO.

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