Standard Exploration Ltd announced Jan. 3 that it has received the final approval for its private share placement from the TSX Venture Exchange, which amounts to C$18 million.
The Calgary-based oil and gas producer issued 289.6 million units and around 611 million common shares for total proceeds of C$18 million. Each unit consists of one common share and one performance-based common share purchase warrant, which could be exercised based on one-third of the 20-day volume weighted average trading price of the common shares equal or exceeding 3 Canadian cents, an additional third upon market price equaling or exceeding 4 Canadian cents and a final third upon the market price equaling or exceeding 5 Canadian cents.
Each performance warrant could be exercised for 1.5 common share, if the market price exceeds 8 Canadian cents.
The private placement will primarily be used to fund the company's US$3.4-million cash acquisition of fellow Calgary-based producer Gulf Pine Energy Partners LP, which amounts to a total US$24.4 million. Gulf Pine focuses on fields in Alabama and Mississippi.
The remaining fund will be used for short-term exploration and development costs and general corporate purposes.
The company also disclosed its new management team recognizes the potential in under-exploited basins in the U.S. Gulf Coast states. It stressed it will move away from high-priced and infrastructure constrained shale basins in the U.S., opting for proven oil and gas basins.
The TSX Venture Exchange also approved the appointment of a new management team and a new board of directors, acquisition of the limited partnership units of Gulf Pine and the name change from Standard Exploration Ltd. to Southern Energy Corp., including the change of its trading symbol to SOU.