Riverstone Energy has announced a dilutive share issue. It intends to raise up to £65m through a placing and open offer at £8 per share and intends to use up to US$67m of the proceedes to increase its stake in Canadian International Oil Corp. The open offer, due to launch on 23 November 2015, is being conducted on the basis of 1 New Ordinary Share for every 9 REL ordinary shares in issue. The results are expected to be announced on the 9th December 2015. The Company has agreed not to issue further shares for 6 months following the admission of the new shares due to a lock-up arrangement with J.P. Morgan Cazenove and Goldman Sachs who are jointly sponsoring the fund raising.
Riverstone Energy currently owns 14% of Canadian International Oil although this will increase to 16% as a result of recent investments due to complete in early December 2015. In total, Riverstone-managed funds currently own 41% of CIOC, rising to 49% following the recent investments.
Canadian International Oil Corp. is a Calgary-based upstream oil and gas company focused on the delineation and development of its Deep Basin position in West Central Alberta. Riverstone say that it is a widely held private Canadian company and that, since its establishment in 2009, has aggregated one of the largest and most advantaged land positions in the emerging Montney and Duvernay formations of Western Canada’s Deep Basin. Canadian International Oil controls and operates approximately 94 % of this asset base, which comprises approximately 192,000 acres prospective for the Montney and 219,000 acres prospective for the Duvernay. Riverstone also say that, in their view, the investment opportunity in Western Canada’s Deep Basin is sizable and very robust even in a low oil and gas price environment.