Corcel plc (AIM: CRCL): Raising new equity to grow and progress Angola
• Corcel has raised £2.72 million of new equity at a price of 0.16p per share, representing a premium of 6.7% to yesterday's close. The company will also issue one warrant per new share with a strike price of 0.225p per share (24-month duration). Following a six-month period, Corcel will have the right to request the warrants to be exercised if the share price is equal to or above 0.30p per share for a period of 25 consecutive trading days.• The proceeds from the raise will allow Corcel to (1) increase its interests in the Kwanza basin and (2) progress desktop studies in Angola to commission a new seismic campaign by the end of 2Q25.
• Exercising the warrants would provide ~£3.8 mm of additional capital which would fund the seismic programme. This programme will boost Corcel's bargaining position with potential farm-in partners.
• An additional 5% interest in KON-16 has an unrisked NAV of ~0.40p per share (representing more than 2.6 times the current share price).
• We reiterate our target price of 1.00p per share. Successful drilling of a post-salt target at KON-16 (~100 mmbbl) could add ~1.00p per share, with a further unrisked value of 3.10p per share for the pre-salt target (~300 mmbbl).
Other newsflow in 1H25
The results of workover activities at the Tobias field in Angola are expected in 1Q25. A successful outcome would enable the company to book reserves. Our unrisked NAV for these activities is 0.05p per share. The company also plans to undertake workover activities at the Irai field in Brazil, with an unrisked value for the field of 0.03p per share. These workover activities in Angola and Brazil would position Corcel to become a producer.
Valuation
Our new ReNAV, which incorporates the new equity raise, is now 0.99p per share.
Regency Mines is engaged as a natural resource exploration and development company. Co. manages a balanced portfolio of mineral and oil and gas projects and investments at different stages of development. Co. is active in multiple international locations including the U.K., Papua New Guinea, the U.S. and Greenland.
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