HOUSTON - U.S. Energy Corp . (NASDAQ:USEG), an American energy company with a market capitalization of $111.53 million, has announced the pricing of its public offering of 4,236,000 shares of common stock at $2.65 per share. The offering, which is expected to close on January 23, 2025, is projected to net approximately $10.5 million after underwriting commissions. This capital raise is part of the company’s strategy to fund its industrial gas development project, which includes the drilling of new gas wells and the acquisition of processing plant and equipment. According to InvestingPro data, the company’s stock has shown remarkable momentum with a 76.28% return in the past week.
In addition to the primary offering, the underwriters have been granted an option to purchase up to an additional 635,400 shares. If this over-allotment is exercised, U.S. Energy may use the additional funds to repurchase shares from Sage Road Capital, LLC, or its affiliates at a price equal to the net offering price. The company maintains a strong balance sheet with more cash than debt, one of several key insights available through InvestingPro’s comprehensive financial analysis.
Roth Capital Partners (WA:CPAP) is serving as the sole book-running manager for the offering, with Johnson Rice & Company and D. Boral (OTC:BOALY) Capital acting as co-managers. The offering is being made under a shelf registration statement on Form S-3 that was filed with the U.S. Securities and Exchange Commission (SEC) and became effective on September 15, 2022.
Investors interested in the offering can obtain copies of the preliminary prospectus supplement and the accompanying base prospectus from Roth Capital Partners or by accessing the SEC’s website.
U.S. Energy Corp. focuses on the acquisition and development of high-quality assets within the United States, aiming to optimize production and generate sustainable cash flow while maintaining a commitment to reducing its carbon footprint in its operational areas.
The company’s forward-looking statements outline various risks and uncertainties that could affect the size, timing, and completion of the offering, as well as the company’s future growth and profitability. These include market conditions, oil and natural gas price volatility, and the ability to integrate acquired assets effectively.
This news article is based on a press release statement from U.S. Energy Corp. and does not constitute an offer to sell or a solicitation of an offer to buy any securities.
In other recent news, U.S. Energy Corp. has made significant strides in energy development. The company reported a noteworthy discovery of high-quality helium in Montana, with independent laboratory results confirming helium concentrations up to approximately 1.5%. This discovery, primarily found in nitrogen-based and CO2-based formations, has enhanced the economic potential of the company’s assets and positions U.S. Energy as a potential leader in carbon sequestration initiatives.
In addition to this discovery, U.S. Energy Corp. has also cleared its debt and initiated a new development program in Northwest Montana. The company is targeting helium and other industrial gases in this region, where it holds an 82.5% working interest. Moreover, the company’s CEO, Ryan Smith, has had his contract renewed until 2027, ensuring his leadership in the company’s future endeavors.
Recent developments also include U.S. Energy Corp. regaining compliance with Nasdaq’s minimum bid price requirement and the sale of its South Texas assets for an estimated $6.5 million in cash. The company’s mid-year 2024 SEC proved reserves report indicates 3.5 million barrels of oil equivalent, with a present value discounted at 10% of $50.9 million. This, along with a strong liquidity position of approximately $22 million, underscores U.S. Energy Corp’s commitment to optimizing production and generating free cash flow.
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