Scotland driller Dart Energy is in the throes of a major cash crisis, an Australian stock exchange announcement today reveals.
Large-scale community resistance has prevented the driller from obtaining planning permission at Airth; led by the Forth valley Against Unconventional Gas group (FAUG). Dart is now perilously close to running out of money.
Dart has plans for the UK’s biggest unconventional gasfield in the UK to date – at Airth in Scotland.
An anonymous Dart Executive recently admitted: “Dart Energy has been facing a fund crunch.”
To alleviate it’s cash problems, in the past six months, the company has sold everything it can to remain viable. In June it sold its Chinese assets for a US$12m loss. Dart also sold a piece of their UK portfolio for £425,000 – a paltry sum in the world of oil and gas, and an amount that reveals the company’s desperate need for cash – however it can get it.
The Australia-listed driller has also recently cut staff, reduced the size of its board and closed down offices, most notably its head office in Australia. More cuts are expected. The company is attempting to entice other companies to join its exploration sites in the rest of the UK. It today also announced the sale of some Indian assets.
More than 2500 local people from the Forth Valley have signed a Community Mandate that demands an overhaul of local and national policy and a re-assessment of Dart Energy’s application. You can learn more about their campaign here. After 12 months of delay the planning process continues to grind through the Scottish government – and each month the company burns US$1.1m in operational costs.
This is far from the heady days when Dart was granted a £100m overdraft facility by shareholder HSBC, and when the company’s share price hit its high of Aus$0.92. These days shareholders can expect Aus$0.06 for their investment, a 92% loss.
To add to the company’s woes, the sale of its Chinese assets has not produced the cash expected. 75% of the money is still being held by the buyer, awaiting various approvals from the Chinese government. Without this cash the company will soon be technically trading at a loss, hence the scramble to ‘restructure’ the company (read sell everything they can get their hands on).
