Tower Resources raises $32m to buy Rift Petroleum

Joseph Keefe April 9, 2014

Oil and gas explorer Tower Resources (RTWRF) is raising 19.3 million pounds ($32 million) to expand its African drilling programme and help finance the acquisition of Africa-focused Rift Petroleum, the company said on Wednesday.

Tower Resources also announced the purchase of a 15 percent stake in Block 2B onshore Kenya from Taipan Resources for $8 million, subject to approval of project partner Premier Oil.

Tower Resources, listed on London's Alternative Investment Market (AIM), said with the successful takeover of Rift Petroleum it will be the only AIM-listed oil and gas explorer with significant exposure to licences offshore South Africa.

"The team has been searching for a good entry point to South Africa for some time, so the chance to acquire the excellent Rift Petroleum assets there and in Zambia was also too good an opportunity to pass up," said Tower Resources chairman Jeremy Asher.

Rift Petroleum owns a 50 percent stake in two South African offshore areas near sites where oil majors such as Exxon, Total and Shell are currently active.

Tower Resources also announced a $3.5 million group operating loss for the year 2013 as it expanded its drilling programme, but held $17.5 million in cash at the end of the year following a share issuance.