The share placement to some “leading international and Australian institutional” investors will see 175 million new shares launched at 5.3c each.

About $US3.5 million ($A4.2 million) of the funds will be spent acquiring a new rig capable of drilling to depths of 2500m, while the remainder will be used on an initial 11-well campaign designed to assess prospects across four licences in the Fergana Basin.

“The drilling program, scheduled to commence in July, will see the company move into the next phase of its development and is expected to result in Caspian becoming an oil producer, supplying the Jalal-Abad refinery located close to its oil leases,” it said.

Meanwhile, Caspian said it had received interest from other operators in the region regarding the use of the new rig on their acreage, which could be exchanged for a farm-in interest.

Caspian holds about 24,000 square kilometres acreage and 18 licences, about 70% of the country’s prospective acreage. Most of its blocks lie in margins of the Fergana Basin once connected to the oil-rich Tarim Basin in China.

While much of Caspian’s acreage has seen very little previous exploration, the oil-prone Fergana Basin has been producing oil continuously since the early 1900s and has about 60 oil fields.