COPL Shares Rose 9.8% on $14.8M Convertible Bond – Here’s Why

The Canadian Overseas Petroleum Limited’s (LON: COPL) share price rose 9.75% after completing a $14.8 million convertible bond financing. The company noted that its main bondholder, new institutional investors and other institutional stakeholders provided the principal amount.

With operations in Converse and Natrona Counties, Wyoming, USA, the oil and gas company did not have trouble raising the above sum, given that investors could see the potential in its assets already producing oil and gas.

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COPL issued 70,257,026 new warrants to back the new convertible bonds. While the company did provide the exact price at which the warrants would be exercised, it confirmed that the exercise price represented a premium to the company’s closing share price on the LSE. 

Having closed the convertible bond financing, the company triggered the 6^th Amendment and Waiver of certain covenants according to its Senior Credit Facility, as announced on March 20, 2023. COPL also issued 26,842,036 common shares to settle $2.2 million of payables to its arm’s length creditors. 

The convertible bond proceeds will help COPL fund its operations and renegotiate its Reserve Based Lending (RBL) with ongoing negotiations. The oil and gas company will also be able to continue funding its operations and expanding its presence in Wyoming. 

In its last press releases, the company’s CEO, Arthur Millholland, stated the following. 

Arthur Millholland, President & CEO, commented: “This is an important raise for COPL.  After some bumpy months operationally and in our refinancing negotiations, this raise supports the company to an intended RBL and for the capital investment required to achieve a material production uplift. We appreciate the support of our leading investors and are excited about the deployment of this capital.”

*This is not investment advice. 

COPL share price. 

The COPL share price rose 9.75% to trade at 5.63p, from Friday’s closing price of 5.13p.