Wednesday 1 August 2018

- Portfolio of eight, high probability of success, technically independent prospects, generated off new proprietary 3D seismic

- Large prospective resource provides material upside upon success through oil and gas production growth

- Highly experienced and privately owned US Gulf Coast operator Hilcorp Energy to execute drilling and development program

- Identified access to infrastructure ensures a rapid, low capex pathway from discovery to production upon success

- Attractive deal terms with potential for further opportunity beyond the initial eight wells

- Program complements Otto’s existing drilling campaign at Bivouac Peak in the GoM and Alaska North Slope, providing shareholders with exposure to 10 wells over the next 18 months

- Program funded with Placement and Underwritten Entitlement Offer to raise A$20 million

Otto Energy announced that it has entered into a joint venture with Hilcorp Energy which will see it earn a 37.5% working interest in an eight well portfolio of prospects in the Onshore/Near Shore USA Gulf Coast (Gulf of Mexico). The wells will be drilled by Hilcorp, a highly experienced, privately-owned operator based in Houston, over the next 18 months.

The Company is undertaking a capital raising of approximately $20 million via an institutional Placement and a fully-underwritten, accelerated non-renounceable Entitlement Offer to fund its US$37.5 million share of the drilling program. The capital raising will complement cash on hand and future cash flows from Otto’s 50% owned SM 71 producing oil field in the Gulf of Mexico to fund Otto’s full exploration program over the next 18 months, including Bivouac Peak and Alaska.

Further details