DXI Energy Inc (TSE:DXI) (OTCMKTS:DXIEF) has closed an upsized brokered private placing, raising almost C$960,000 to convert its natural gas processing facilities at Woodrush in British Columbia into a methanol production facility and for general working capital.
In September this year, the junior oiler unveiled its new strategic direction, which will see it transition to a regional producer of methanol.
Its own internal estimates had shown the potential to increase net income from operations by 900% as market demand for methanol, used in the oil and gas sector, in the region is high.
READ: DXI Energy, which plans to become regional methonol producer, reduces expenses in third quarter
The firm issued over 31.9 million units at C$0.03 each, bringing in gross proceeds of C$959,832.
Due to strong investor interest, DXI had received TSX approval to increase the size of the financing from C$750,000 (25 million units at C$0.03 each) to up to C$1.2 million (40 million units at C$0.03 a throw).
"This new capital will be applied to fund the initial methanol plant design and development costs, as well as general working capital for ongoing oil and natural gas production operations," said president and CEO of DXI Simon Raven.
"We are presently engaged in the process of securing project financing for the methanol plant, including discussion with methanol distributors in NE B.C. and NW Alberta and methanol plant EPC contractors in both the United States and Canada. We look forward to reporting to all stakeholders as certain project milestones are completed and additional progress is achieved."
In the placing, each unit comprised one share, and one share purchase warrant, entitling the holder to acquire a further share for C$0.04 each for one year from the date of issue.
Shares were unchanged at C$0.035 in Toronto.
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