Swala Energy Ltd., the Australian oil and gas exploration company, plans to list shares in its Tanzanian unit on the East African nation’s stock exchange next quarter to raise funds for seismic surveys and growth.
Swala Oil and Gas (Tanzania) Ltd. is targeting an Oct. 1 debut on the Dar es Salaam Stock Exchange’s Enterprise Growth Market, or EGM, Swala Energy Chief Executive Officer David Mestres Ridge said in an interview yesterday in the commercial capital. The company, in which Swala Energy owns a 65 percent stake, is preparing listing documents to be submitted to the Capital Markets & Securities Authority and plans to raise as much as $2 million, he said.
“We need to raise equity to grow and we want to do that here so that we include Tanzanian investors in that growth,” Ridge said. “Our target is Oct. 1, but it depends on how fast the process will be.”
Swala began a seismic survey in Tanzania’s Kilosa basin, where it has an exploration license covering about 17,700 square kilometers (6,834 square miles). A similar inspection is planned next month in the Pangani region, where the company also owns a permit, according to its website. The East African nation estimates it has 41.7 trillion cubic feet of recoverable natural gas reserves.
Swala’s listing is being managed by Tanzania Securities Ltd., which expects to submit documents to the market regulator by the end of this week, Joseph Uiso, acting CEO for the Dar es Salaam-based brokerage, said in an interview.
The Dar es Salaam Stock Exchange has 17 companies with a total market value of $8.87 billion, according to bourse data. Swala may become the first company to list on the EGM.
The regulator has received two applications from domestic companies to list on the segment, which was started in December 2012 and offers less-stringent listing requirements than the main market to encourage startup companies to raise capital.
“We have not yet approved any of the submissions, but it’s our hope that at least one product will start trading before the end of the year,” said Charles Shirima, a spokesman for the regulator.
Shares in Swala Energy fell 9.5 percent to 19 Australian cents in Sydney today. The stock began trading on the Australian Securities Exchange in April after an initial public offering at 20 cents a share.