The CSG hopeful, which holds 7 million acreages in the South Gobi desert close to the Chinese border under a production sharing contract with the Mongolian government, plans to expand its exploration and appraisal plans and bring forward its timetable by up to year.
Elixir said given the successful first stage of its exploration campaign in early 2020 and the containment of COVID-19 in Mongolia it decided to raise funds of $2 million to expedite delineation and exploration efforts.
It planned to raise two thirds of this via placement with director participation and the rest from a SPP.
It sought a minimum of $1.25 million but bids received were over $2 million.
Rather than cancel the planned SPP the board decided to scale back the placement to $1.65 million, plus the $100,000 earmarked for the directors, which subject to shareholder approval.
"It has become clear that the existing Elixir shareholders shared the board's view that this was an attractive investment opportunity by subscribing for over $2.9 million in the SPP," it said.
If all of those were accepted the SPP alone would raise more than the original combined target of $2 million.
"In these circumstances the board needed to consider the issue of equity for the places given their expectations of the dilutionary impact of the following SPP, while ensuring existing shareholders expectations of the SPP were met at least in part," it said.
The board will cap the SPP at $1.65 million and eligible shareholders have been allocated a number of SPP shares equal to 75% of the amount of shares held on the record date.
Managing director Neil Young told Energy News we"how do we scale it back and still be fair to everybody? We scaled it back in accordance with shareholding numbers at at the recore date, so those with two shares couldn't get $30,000 worth."
The lowest amount which can be applied for is $2,500 and the maximum $30,000.
The combined total amount raised will be $3.35 million.
Elixir's has been one of several recent successful raising by companies as shareholders start to see value in gas-focussed companies with a story, or a strong market.
Young pointed to Warrego Energy's recent $15 million raising to progress its Perth Basin plans, noting the geology of the area and recent prospectivity coupled with backfill options given LNG projects in the north of the state have been delayed is winning back investors after a mass energy selloff across in early March after the oil price fell.
The money goes to a 2D seismic program, and possibly increasing the size of the program drilling more exploration strat-holes in the Nomgon Sub-basin and and other sub-basin, following up a successful strathole with one more fully tested coreholes.
"We can continue work in Mongolia as we've already proved with local contractors," he said.
"There's no point waiting for all this to blow over as it might not all blow over and you've got to deal with the circumstances as they face you. "