Frontier Energy (ASX:FHE) shares opened 5% higher this morning as the company announced a $10m placement to progress development of its WA-based Bristol Springs Green Hydrogen Project.
Interestingly, Frontier's executive chair Grant Davey has contributed $1 million of his own money to the project.
The placement was completed at 42c (4.5% discount to last closing price), and Frontier notes it won support from institutional and high-net-worth investors.
Upon completion of the placement, Frontier will sit on $13m of cash and expects to be fully funded until 2H 2023 when a final investment decision (FID) for Bristol is made.
The funds in question will broadly go towards:
Early works on-site the project acreage
The development of a hydrogen refuelling station
Two key studies needed for the project: Energy Security and System Security
General working capital and corporate overhead
The issuance of some 23m new shares will be broken down into the following two tranches:
Frontier issues 21.4 new shares at 42c for $9m
After to shareholder approval, Frontier issues a further 2.4m shares for $1m
“We are delighted to announce the completion of the placement, which will enable the company to continue its operational strategy of advancing the Bristol Springs Project,” Frontier MD Sam Lee Mohan said.
Mohan joined the Frontier team only recently and comes from ATCO where he was the former head of Hydrogen strategy for the pipeline and energy player.
“We thank all our existing and new shareholders for their notable support,” Mohan added.
Earlier this month, Frontier began the process of locking in offtake partners for the hydrogen it is set to produce domestically in WA in 2025.
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