“Although Reach Energy estimated the near-term capex to be low, the company is currently contemplating a fundraising proposal as mentioned in the company’s announcement dated March 5, 2016,” it said in a statement yesterday.

The oil and gas special-purpose acquisition company (SPAC) added that it will make the necessary announcement when there is material development on the fundraising proposal.

Reach Energy managing director Shahul Hamid Mohd Ismail said on April 6 that the SPAC has no plans to launch a cash call on investors to fund the capex incurred by its QA in the near term.

He told a news conference that the capex, amounting to about US$15 million (RM58.35 million) from now till 2019, would be funded internally as the company has “sufficient funds” for the exercise.

In its statement yesterday, Reach Energy said as per its March 5 announcement, the completion of the proposed QA is conditional on the conditions precedent of the agreement entered on the same day.

The agreement involves a deal between Reach Energy with Palaeontolol Cooperatief UA (PCUA) and MIE Holdings Corp (MIEH).

Reach Energy plans to acquire a 60% stake in PCUA’s wholly-owned unit based in the Netherlands, Palaeontolol BV, for US$154.9 million. Palaeontolol owns the Emir-Oil fields in Kazakhstan.

PCUA is a wholly-owned subsidiary of Hong Kong-based MIEH.

The purchase consideration is 84% of the RM750 million proceeds the SPAC raised from its initial public offering.

Reach Energy said the conditions precedent of the agreement for the proposed QA include obtaining the decision of the Securities Commission Malaysia and the approval of shareholders of Reach Energy and MIEH.

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