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Nautical Petroleum raises £30.35m for next phase of North Sea exploration

Nautical Petroleum (LON:NPE) has raised £30.35m with a placing of 24.2m shares at 125p each, to fund its planned exploration, appraisal and pre-development activity until the end of 2011.

The financing follows the recent Catcher oil discoveries in the North Sea - Nautical has a 15% interest in the project.

The other partners on the licence are operator EnCore Oil (LON:EO) with 15%Premier Oil (LON:PMO) with 35%, Wintershall (UK North Sea) Ltd with 20% and Agora Oil & Gas with 15%.

In Early June, the company struck a high-quality oil bearing reservoir from the 28/9-1 exploration well in the Catcher area, and later the 28/9-1Z side-track encountered similar oil bearing sandstones at Catcher East. In July, to complete the drilling programme, a third well, the Catcher 28/9-1Y sidetrack also encountered “excellent quality oil bearing reservoir sandstones”.

Today’s fundraising will enable Nautical to participate in a further three-well drilling program and the preparation of a Field Development Plan (NYSE:FDP). Additionally, the placing will also finance work on the Kraken and Mariner projects.

"We are delighted to have raised these funds, which enable Nautical to fulfil its work programmes on Kraken, Catcher and Mariner, and accelerate the evaluation of other opportunities in our portfolio,” Nautical chief executive Steve Jenkins commented.

“We have an exciting period of activity ahead commencing with the Kraken well this month. This will be followed by the drilling of three exploration wells on the Catcher block."

The 9/02b-D Kraken appraisal/exploration well to be drilled in 2010, and FDP preparation will also get underway following the funding. The Mariner project will be advanced to project sanction and FDP submission in 2011, and funding will aid the remaining exploration and appraisal programme.

Nautical highlighted it own estimate which collectively values the assets at £356m.

Alongside Nautical equity issue, the company’s largest shareholder International Energy Group AG, placed 13m Nautical shares with institutional investors, and reduced its holding to 4.4m shares. The shareholder’s 13m placing shares represented around 20% of the current issued share capital, and it now holds just 5% of the company.