UPDATE: Ithaca Energy Fully Funded After Raising C$158 Mln

8th Jul 2010 12:08

(Adds executive comment and detail.) By Rachael Gormley and Jason Douglas Of DOW JONES NEWSWIRES LONDON (Dow Jones)--North Sea-focused oil and gas company Ithaca Energy Inc. (IAE.V) Thursday said it now has enough money to bring its Stella, Harrier and Hurricane projects into production following a C$158 million fundraising. Chief Exploration Officer Nick Muir told Dow Jones Newswires the fresh funding means Ithaca can now accelerate the development of the Greater Stella Area, where about 70% of the company's reserves are located. Ithaca had reported proven and probable reserves of just under 42 million barrels of oil equivalent at April 30 and proven reserves of 20.9 million. Muir said Ithaca is aiming to bring Stella and Harrier into production in the second half of 2012 and Hurricane a year later. All three are in the Greater Stella Area. Over the next two years, the company will carry out engineering design work and further drilling to prepare Stella and Harrier for production. It also intends further appraisal drilling at Hurricane, said Muir. The development plan for Stella includes four oil-producing well and one gas producer and two gas-producing well at Harrier. The company estimates it will cost $288.8 million to bring Stella into production and $79 million to develop Harrier. The money raised will be added to a $140 million loan organized by Bank of Scotland earlier this year and cash from Ithaca's existing operations, which means all Ithaca's projects are now fully funded, the company said. Ithaca's cash flow is funding development of another project, Athena, which is expected to start production in the second half of 2011, said Muir. Ithaca said it raised C$81 million through the sale of 47.6 million shares at C$1.70 each in Canada and $77 million through a U.K. placing handled by Cenkos Securities. The U.K. placing was pitched at 107 pence, an 8.2% discount to Wednesday's close and at 1054 GMT, London-listed shares in Ithaca were down 7 pence or 6% at 109.5 pence, underperforming a 0.8% higher Alternative Investment Market. Muir added Ithaca continues to hunt for acquisitions. -By Rachael Gormley, Dow Jones Newswires; 44-20-7842-9308; [email protected] (END) Dow Jones Newswires July 08, 2010 07:08 ET (11:08 GMT)