Frontier Energy Completes AU$11.5 Million Placement to Fund Waroona Renewable Energy Project

Source: Kapitales Research

Highlights

• Frontier Energy Limited (ASX: FHE) has raised AU$11.5 million through a placement of 46 million new fully paid shares at AU$0.25 per share.
• For every two shares issued in the placement, one attaching option is granted, with an exercise price of AU$0.40 and a two-year expiry.
• Proceeds will fund debt financing and cover the security deposit required under the Reserve Capacity Mechanism for the Waroona Renewable Energy Project (Stage One).
• The Waroona project is expected to generate AU$32 million annually from capacity payments during the first five years of production.
• Approval from directors and shareholders will be requested for the issuance of new shares and options to the directors.
• The key dates for the issuance of shares and the lodgement of the prospectus are scheduled for December 2025 and January 2026.

Placement to Accelerate Project Financing and Development

Frontier Energy has successfully completed an AU$11.5 million capital raise to support the continued development of the Waroona Renewable Energy Project. The funds will be used to secure the necessary Reserve Capacity Mechanism deposit, which guarantees revenue through capacity payments, in addition to completing debt financing required for the project's Stage One development.

The placement price of AU$0.25 per share represents a 3.85% discount to the last closing price. This strategic raise enables Frontier to build on the momentum for Stage One, which is forecast to generate AU$32 million per year from capacity credits, providing substantial revenue and underpinning project financing.

Strengthening Project Financing and Governance

In addition to the general placement, 16 million shares and 8 million attaching options will be issued to Frontier directors, subject to shareholder approval at a general meeting in January 2026. The attaching options, exercisable at AU$0.40 within two years, align director incentives with shareholders, ensuring strong governance as Frontier advances the Waroona project.

Timetable and Use of Funds

The placement also includes the issuance of 15 million attaching options at an exercise price of AU$0.40, with the issuance scheduled for December 2025. The funding from the placement will be used to:

• Secure the Reserve Capacity Mechanism deposit.
• Conclude the arrangements for securing debt funding for Stage One of the Waroona project.
• Cover corporate costs and general working capital needs.

Key events to look out for include the settlement of the new shares on 16 December 2025, the lodgement of the prospectus for the attaching options on 16 December 2025, and the allotment of shares and options on 17 December 2025.

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