UK-listed oil and gas, mining companies raise £1.1 billion in new equity

Oil and gas and mining companies raised £1.1 billion in new equity in the 12 months up to the end of September 2021, according to figures in a new study published by accountancy group UHY Hacker Young.

The £1.1 billion in new equity raised by natural resources firms via the UK markets is a 307% increase on the £270 million raised in the prior comparable period. Hacker Young attributed the rise to booming commodity prices amid a strong recovery from the COVID-19 pandemic in the period.

Oil and gas prices have hit multi-year highs in recent months, while metal prices – including copper and lithium – have also rebounded strongly since the turn of the year. This has led to resources firms heading to the markets to raise money for previously stalled projects.

The London stock market, including the junior Alternative Investment Market (AIM), has a strong reputation for helping oil and gas and mining stocks develop, according to Hacker Young. “UK investors are seen as more patient than some of their global peers, giving these companies the time and money needed to grow and reach their potential,” the report read.

Daniel Hutson, partner at Hacker Young, said: “The market for commodity stocks right now is very hot, particularly among mid-caps and AIM stocks.

“AIM is one of the strongest stock markets globally for oil and gas businesses. The last 12 months were a significant test, where investors were asked to back these businesses during an unprecedented period of economic turmoil. AIM passed that test with flying colours.

“People will still need oil, gas and metals for many years to come,” he added.