Tangiers launches $5m placement

Shares in Perth-based oil and gas explorer Tangiers Petroleum have closed lower after the company announced plans to launch a heavily discounted $5 million share placement.

Tangiers said it would issue about 31.2 million shares at 16 cents each to wholesale and institutional investors over two tranches.

The issue price represents a 24 per cent discount to Tangiers' last closing price.

In a brief window of trade today, Tangiers shares fell 14.3 per cent to close the day at 18 cents.

Funds raised from the placement will go towards drilling at the TAO-1 well in Morocco, which Tangiers managing director David Wall described as "a potential company-making opportunity".

DJ Carmichael, Foster Stockbroking and BBY Limited are acting as lead joint managers of the placement.

Tangiers launched a takeover bid for fellow oil and gas explorer Jacka Resources late last year, but the deal collapsed when the company failed to secure support from several major shareholders.

The failed bid resulted in the resignation of Tangiers' former executive chairman Eve Howell and non-executive director Max de Vietri.