Zak Mir talks to Harry Baker, CEO of Borders & Southern, after the London-based independent oil and gas company with assets offshore the Falkland Islands announced a fundraising campaign to raise approximately £1.86 million. They discuss the new “drill, baby drill” mantra in the market and Borders’ strategy and outlook.
Borders & Southern is an independent oil and gas exploration company based in the UK, primarily focused on the Falkland Islands. Recently, the company made headlines with its announcement of a fundraising initiative aimed at raising approximately £1.86 million. This move reflects the company’s strategic approach to capitalizing on its assets and positioning itself in the market.
Understanding the Fundraising Announcement
During a recent discussion, Harry Baker, the CEO of Borders & Southern, elaborated on the reasons behind this fundraising effort. Historically, the company has raised two years’ worth of working capital, but in the last round of fundraising in October, they opted to raise only one year’s worth. Baker emphasized that the decision was made because the company’s share price at the time did not accurately reflect the potential internal and external catalysts that could drive the stock’s value upward.
Funding for Future Opportunities
The primary goal of the recent fundraising is to ensure that Borders & Southern is fully funded until the end of 2026. This financial cushion is crucial as the company seeks to engage in farm-out conversations regarding its significant discovery project. Baker expressed that being well-funded allows the company to negotiate from a position of strength, enabling them to pursue the right deals rather than settling for the first offer that comes along.
Market Dynamics and Investor Sentiment
As the conversation progressed, Baker reflected on the changing dynamics within the oil and gas sector. He noted that there has been a notable increase in industry appetite for oil projects, particularly as companies are now more focused on acquiring barrels. The sentiment in the market has shifted, with a growing recognition that oil will continue to play a significant role in the energy landscape, despite the rise of alternative energy sources.
The Falkland Islands: A Unique Opportunity
Baker highlighted that the current landscape for oil exploration in the Falkland Islands is markedly different from past drilling campaigns. Previously, there were multiple companies vying for attention in the region, but now the focus has narrowed significantly. With only Borders & Southern and Rockhopper remaining as the primary players, there is a sense of urgency and opportunity as the industry seeks to tap into the rich resources of the Falkland Basin.
Strategic Positioning in a Competitive Market
The CEO articulated the importance of Borders & Southern’s strategic positioning. With a focus on delivering results, the company is keenly aware of the competitive landscape and the potential for lucrative partnerships. Baker pointed out that the company boasts a world-class asset, with a near-term development story that includes a significant amount of recoverable oil. This positions them favorably as they engage with potential farm-out partners.
The Importance of Timing and Market Readiness
One of the key themes that emerged from the discussion was the importance of timing in the oil and gas industry. Baker noted that different companies take varying amounts of time to assess opportunities and come to the table with proposals. This means that while some companies may be ready to engage quickly, others may require more time to understand the potential of a new basin.
Creating Competitive Tension
To facilitate the right deals, Borders & Southern is working with farm-out advisers to create a competitive environment. This competitive tension is vital in ensuring that the company can secure the best possible arrangements for its assets. Baker expressed optimism about the growing interest in their projects, stating that the congregation of companies interested in their story is widening.
Future Outlook: What Lies Ahead for Borders & Southern
Looking ahead, Baker conveyed a sense of excitement about the future of Borders & Southern. The company has a dedicated team working tirelessly to deliver value to its shareholders. Baker acknowledged the loyalty of long-term shareholders and expressed gratitude for their support as the company embarks on new ventures.
No Immediate Projections
However, Baker was cautious about providing specific timelines or projections regarding upcoming deals. He emphasized that the nature of negotiations can be complex, and it’s essential to allow potential partners the time they need to evaluate the opportunity thoroughly. This careful approach ensures that when a deal does materialize, it is well-considered and beneficial for all parties involved.
Conclusion: A Bright Future for Borders & Southern
In conclusion, Borders & Southern is at a pivotal moment in its journey. With a robust fundraising strategy in place and a clear vision for the future, the company is poised to capitalize on the rich resources available in the Falkland Islands. Baker’s insights highlight the importance of strategic planning, market readiness, and maintaining strong relationships with shareholders and potential partners. As Borders & Southern navigates this exciting landscape, there is much anticipation for what lies ahead
