Rockhopper announced yesterday that it has successfully raised the equity required to deliver first oil from the Sea Lion field in the North Falkland Basin. In an oversubscribed equity placing, the company has raised up to US$140m, subject to shareholder approval, and conditional on the partners reaching a final investment decision (FID) by the end of March next year. The new money was raised at 53p/shr, plus a quarter warrant with an exercise price of 80p. The share price responded well to the news, closing yesterday at almost 72p/shr. Having accounted for the dilutive effect of the raise, and cutting our commercial risk factors on Sea Lion, we calculate an updated risked core NAV of 71p/shr and a total NAV of 105p/shr. At the latter point we set our target price, which now offers around 46% upside. The next major milestone for the project will be securing the cUS$1bn of project finance, which we expect over the coming months. This will allow for the partners to reach a final investment decision (triggering admission of the new equity) and move ahead with the development. First oil is anticipated for 1Q28, with gross production at start-up around the 45 kbopd mark.
