Tower Resources rises on drill funding

Tower Resources, the Africa focused oil and gas explorer, is up 2.3% this morning on news of a new financing agreement.

Tower has tapped investment fund manager, Yorkville Advisors, for an initial $3.35m loan, with the capacity to increase the amount to $6.125m if required.

The loan is backed by an equity distribution agreement which will be used for repayment.

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Tower needs the money to pay for drilling at its Mvule-1 well in Uganda.

Tower's Chief Executive, Peter Kingston, said of the deal:

"The arrangement provides flexible funding options which represent the best and most cost effective opportunity to drill the highly prospective Mvule-1 well. If successful, the well has the potential to create a great deal of value for our shareholders."

Today's announcement claims Mvule-1 is intended to test an estimated recoverable potential in Uganda of 80 million barrels of oil.

Tower's share price has dropped 41% in the last 12 months.

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