North Sea explorer Ithaca secures $66m injection

Ithaca has raised $66m from Israeli group Delek
Ithaca has raised $66m from Israeli group Delek
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Ithaca Energy has hailed a $66 million (£43m) injection from an Israeli group as a “solid vote of confidence” in the North Sea oil and gas firm.

Aberdeen-based Ithaca, which is listed in London and Canada, said Delek is set to acquire a near-20 per cent in the business through a share placing, priced at a 19 per cent premium to yesterday’s closing price on the Toronto Stock Exchange.

Proceeds of the cash injection will be used to strengthen the Aim-quoted explorer’s balance sheet, reduce its bank debt and provide flexibility for “value-accretive” opportunities in the Greater Stella Area.

Chief executive Les Thomas said: “We are pleased to have secured Delek’s investment in the company at a significant premium to the prevailing share price at this time of uncertain oil prices.

“The investment provides a solid vote of confidence in the long-term value of Ithaca by a successful oil and gas investor and provides additional flexibility to execute the financial and strategic priorities of the business.”

Ithaca said earlier this week that first production from the Stella field is expected at the end of the second quarter of next year.

It also forecast net debt would fall to about $750m by the close of this year, lower than its previous guidance of “under $800m”.

Delek chief executive Asi Bartfeld said the purchase of a 19.9 per cent stake in Ithaca marked a “major step towards expanding our operations in the international market”.

He added: “Ithaca is synergistic with Delek Group’s existing operations. It is an important link in the chain for our operations in this field, and is expected to contribute to the group’s continued growth.

“We intend to continue to take advantage of existing opportunities in the markets and to examine further strategic investments in international companies in the energy field.”