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i3 energy strikes funding deal in preparation for UK licensing round

Staff Writer |
i3 Energy said it has made applications to secure acreage under the UK's 30th offshore licensing round with a view of taking on new assets on a wholly owned basis, and said it has secured $13 million to fund any commitments it may have as a result.

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The UK-focused oil and gas company said it has applied for acreage under which it would own 100%, targeting a "highly attractive region of acreage" that, if awarded, would add 22 million barrels of contingent resources and 47 million of prospective resources to its portfolio.

In turn, i3 Energy has signed a binding agreement with an existing loan note investor, under which i3 has gained access to $13 million of funding for any commitments it will need to satisfy as a result of being awarded acreage under the licensing round. In return, the investor will be entitled to a share of "certain" after-tax revenue from any such acreage.

Of the first after-tax revenue to be generated by such assets, the investor will receive an amount equal to double its investment, and i3 will recover double the amount of any capital expenditure incurred before first oil.

After that, the investor will be entitled to one-third of after-tax revenue with i3 retaining the other 67%.

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