Vintage Energy (ASX: VEN) has opened its $2.1 million entitlement offer, which allows eligible shareholders to subscribe on a 1-for-4 basis at an issue price of 0.5 cents per share.
The company will use the capital raised to fund increased production and cash generation at its Odin and Vali gas fields in the Cooper Basin.
One major focus is a production uplift program of scale management at the Odin gas field and the addition of gas production from the Toolachee Formation at the Vali gas field.
Vintage has already seen a significant improvement in production at the Odin-1 well from its initial measures to remove the accumulated scale.
Raw gas production from the field increased from 1.4 million standard cubic feet per day (MMscf/d) to more than 3.0MMscf/d following the company’s first efforts at scale removal.
The proposed program will install permanent scale management solutions at Odin-1 – including the field’s metering apparatus – and determine whether there are other opportunities for similar improvement at other installations.
The company will also pursue the commencement of gas flow from the Toolachee Formation at Vali, where production has so far been restricted to the Patchawarra Formation.
Gas produced by Odin and Vali is supplied respectively to the Pelican Point Power joint venture and AGL Energy (ASX: AGL).
The entitlement offer will result in the issue of 417.3 million new ordinary shares, all at the price of 0.5 cents per share.
Every new share issued will be accompanied by one free-attaching option with an exercise price of 0.9 cents and an expiry date of two years after the issue date.
The offer price is equal to the last traded price of 0.5 cents on 30 January 2025 and represents a 4% discount to the 10-day volume-weighted average price of 0.52 cents.
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