AN OIL and gas exploration company led by a founder of North Sea-based Venture Production is raising $90 million (£56m) to finance development in Trinidad as it completes the reverse takeover of a rival firm.
The board of Trinity Exploration and Production, chaired by North Sea veteran Bruce Dingwall, will meet institutional investors in Edinburgh next week ahead of the completion of its merger with Aim-quoted Bayfield Energy Holdings in February.
Dingwall and Trinity chief executive Joel “Monty” Pemberton are seeking to raise $50m through the issue of new shares to boost its development programme and for “general corporate purposes”, and up to a further $40m to fund an exploration programme.
Trinity, formed in 2005 out of Caribbean-based assets formerly owned by Venture, claims the merger with London-based Bayfield will make it the largest independent oil and gas explorer in Trinidad and Tobago.
The combined group will produce close to 4,000 barrels of oil per day with an estimated 31 million barrels in its reserves on existing licences, Dingwall said. In a statement the firm added that it plans to pursue an exploration programme on six offshore wells in 2013 and 2014.
Late last year, the company lost out on a bid for a further offshore licence block to giant BHP Billiton. Trinity’s failed bid was made in partnership with Edinburgh-based Cairn Energy.
Dingwall said that the prospects of further Trinity/Cairn bids in 2013 were better than last year as its Anglo-Australian rival was now “fully loaded” having won four out of six exploration blocks made available by Trinidad and Tobago’s ministry of energy and energy affairs.
Dingwall said: “BHP is fully loaded – so I don’t think they will be participating [in 2013]. I would hope that our chances go up.” Dingwall said the deal with Bayfield adds further Trinidad and Tobago-based assets to its portfolio as well as the benefit of a listing.
“Before this merger we had $25m in cash on our balance sheet. We have always kept cash in our back pocket for a rainy day to ensure we can qualify for these sorts of rounds,” he said.
“What is important to governments is when you are public you are transparent – they know who your shareholders are, they know you have direct access to capital in the markets. Also, if you are partnering bigger companies, if you are public it ticks more boxes more easily.”
Trinity’s UK office is based in Edinburgh, while its headquarters are in Trinidad’s second city, San Fernando.
Dingwall, who is a Trinidadian national by dint of having been raised there by his English parents, plans to build the firm in a similar way he did with Venture, which grew by taking on underused fields from major companies in the North Sea.
He said: “We have purposely positioned ourselves as the largest independent in Trinidad. It is about time that country had an independent that is assisting the government and the larger oil companies to develop the oil portfolio that in North Sea terms we would describe as ‘stranded’.
“We are ideally positioned – we have critical mass and good cash flow.”Aberdeen-based Venture, founded by Dingwall and Larry Kinch, was bought by Centrica in a £1.3 billion deal in 2009.