United Oil & Gas plc, a London-based oil and gas exploration firm, is planning to raise £700,000 (approximately J$140 million) through a share offer to support its operations, including activities in Jamaica. The company intends to seek shareholder approval for certain resolutions related to this fundraising at its upcoming annual general meeting in January.
Earlier this month, United Oil & Gas halted all non-core activities to conserve cash, which included pausing discussions with potential offshore drilling partners in Jamaica until 2025. The decision to raise funds from the market is a move to strengthen its financial position during this period.
“This fundraising is a pivotal moment for United as we position the company for exploration-led growth. The funds raised will enable us to fulfill our work program obligations in Jamaica and strengthen our farm out efforts,” stated United Oil CEO Brian Larkin in his release.
Earlier in the year, United Oil & Gas plc raised £1.0 million through a share offer, primarily to support its exploration activities in Jamaica. Now, the company is launching a second share offer to raise £700,000 to further strengthen its financial position. CEO Brian Larkin acknowledged that the second fundraising would result in dilution for shareholders, following the earlier raise. However, he emphasized that this decision was essential to keep the company financially stable and able to seize value-generating opportunities, particularly in Jamaica, which holds significant potential for unlocking shareholder returns.
The Jamaican asset is a key opportunity for United Oil & Gas. An independent estimate valued its most promising reservoir at US$23 billion, with the potential to extract crude oil over 25 years. To confirm whether the substances are crude oil or underground water, the company requires a test drill. United has been exploring offshore Jamaica for several years but scaled back its operations this year after exiting Egypt due to currency-related challenges.
United Oil & Gas has one year remaining on its two-year license extension, which expires in January 2026. The company holds a license to explore 22,400 square kilometers offshore along Jamaica’s southern coast, specifically in the Walton-Morant zone. In its exploration efforts, the company has conducted a series of 2D and 3D seismic surveys, which have uncovered substances resembling oil. However, further investigation, including test drilling, is necessary to confirm whether these substances are indeed crude oil or underground water. This ongoing exploration remains a critical aspect of United’s strategy, especially given the significant potential value of the Jamaican asset.
Two weeks ago, United announced that its chairman, Graham Martin, will step down in January 2025 for personal reasons. The company is actively seeking a successor to guide its next growth phase.
