Shares in BowLeven have taken a hit as the Africa-focused energy company warns of material uncertainty regarding its ability to continue operating.
At 0904 GMT, shares were down 23% at 0.50 pence, representing a decrease of 0.15 pence.
BowLeven issued a statement on Friday, highlighting the significant risk of depleting its cash reserves by the spring and summer of 2024 if new investments are not secured.
The company’s working capital funds are dwindling, and it remains uncertain whether new equity capital will become available or what the final terms of an equity raise might look like.
As of June 30, total funds available stood at $1.5 million, with a cash balance of $1 million by October 31.
BowLeven is pinning its hopes on the completion of Perenco’s acquisition of New Age’s interest in the Etinde shallow water permit joint venture in Cameroon. BowLeven owns a 25% stake in this project, and it is expected to conclude in early 2024. This development is anticipated to facilitate fundraising efforts and monetization of the project.
Despite the financial challenges, Chief Executive Eli Chahin remains optimistic about BowLeven’s future. Chahin emphasizes the company’s renewed focus and clearer vision for the asset’s monetization with the new Etinde operatorship.