Exploration company Providence Resources said it has settled in full its loan facility with Melody Business Finance by payment of $20m, plus interest and an allotment of almost 10 million ordinary shares
In a brief statement, the company said it has also discharged the balance of the money due to Transocean Drilling UK in respect of a court order made in April.
This follows approval of the moves by the company's EGM earlier this month.
Last month Providence Resources announced plans to raise $68.4m through a share placing and open offer. It said the money would be used to pay off debts, settle a litigation case and fund a new drilling campaign.
The company now has a clean balance sheet, which analysts said was rare among exploration companies.
In a note, Davy stockbrokers said the move was an important element in the farm-out negotiations undertaken by the group with respect to concluding a Barryroe deal and farming out the Porcupine Basin Spanish Point prospect.
"In addition, while the group is funded to drill the Druid element of the Druid/Drombeg structure, it will require a farm-in partner to deepen the well to drill Drombeg. All these negotiations can now conclude with no immediate financial pressure on Providence," Davy stated.
"This should lead to an improved outcome with respect to farm-in deals and consequently a better outcome for shareholders," it added.
