88 Energy Ltd on Tuesday proposed funds of up to A$9.8 million, or £5.2 million, via a share placing.

The Alaska-focused oil exploration company said it intended to raise the cash via a placing of new shares at A$0.003 each. This is equivalent to a 40% discount the closing price of 88 Energy’s shares on the Australian Securities Exchange on Monday.

The placing itself will be conducted via a bookbuild.

88 Energy said that once the placing is complete, it will have sufficient cash to fund its ongoing working capital requirements and general and administrative overheads for at least 12 months.

Following successful flow testing at the Hickory-1 discovery well in Alaska, the firm said it would be focused on completing post-well testing and analysis, and securing a contingent resource for the SFS and SMD reservoirs.

88 Energy shares were down 16% at 0.16 pence each in London on Tuesday afternoon. The firm has a market cap of A$62.8 million.

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