U.S. Energy secures $50 million equity line; Katanga Mining prices C$101.5 million PIPE

By Sheri Kasprzak

New York, April 13 - Ahead of the holiday weekend, U.S. Energy Corp. sealed a $50 million equity line with Cornell Capital Partners, LP as oil prices climbed.

Energy and mineral offerings were prominent in the PIPE market Thursday as oil advanced.

Oil prices gained 70 cents to end the day at $69.32 per barrel.

Gold prices retreated with prices still above $600 per ounce. Gold fell $1.20 to settle a $600.10 per ounce. Copper prices, one market source in Vancouver, B.C., said are poised to climb and that may also be pushing mineral offerings.

"It's a bit of gold, a bit of oil and a bit of copper," he said. "I think it's all kind of converging to make for more [deals]."

Back to the U.S. Energy deal, Cornell agreed to buy its shares over three years at 98% of the lowest daily volume weighted average price for the five trading days after notice of a draw.

After the deal was announced Thursday afternoon, U.S. Energy's stock advanced 4.65%, or 31 cents, to settle at $7.05 (Nasdaq: USEG).

"We are pleased to finalize the arrangement for up to $50 million in equity financing with Cornell on terms that we consider favorable to USEG shareholders," said Mark Larsen, the company's president, in a statement. "With uranium prices now at $42.00 per pound, molybdic oxide prices in the mid-$20's per pound and gold prices at a 25-year high of more than $600.00 per ounce, we found ourselves at a unique time in our corporate history."

"Given our significant equity holdings in Enterra Energy Trust, which will become unrestricted on June 1, 2006 and our current cash position of over $7 million, we do not need to raise any capital at the present time," said Keith Larson, U.S. Energy's chief executive officer.

Looking to the company's latest earnings statement, U.S. Energy reported a net income of $8,841,500 for the year ended Dec. 31, 2005, compared to a net loss of $6,248,700 for the same period of 2004.

U.S. Energy, located in Riverton, Wyo., is a gold, uranium, vanadium and molybdenum exploration company.

Katanga prices C$101.5 million

Elsewhere in the natural resources sector, Katanga Mining Ltd. priced a C$101.5 million private placement of 14 million subscription receipts at C$7.25 each, a 5.8% discount to the company's C$7.70 closing stock price on April 12.

The receipts are exchangeable for one common share on the completion of Katanga's acquisition of Kinross Forrest Ltd.

A syndicate of underwriters led by GMP Securities LP has a greenshoe for up to 7 million additional receipts.

The offering was announced Thursday morning and by the end of the day, the stock had slipped 45 cents, or 5.84%, to close at C$7.25 (TSX Venture: KAT).

The deal is scheduled to close May 2.

Proceeds will be used for exploration and development of the company's Kamoto/Dima mining complex in the Democratic Republic of Congo. The rest will be used for working capital and general corporate purposes.

Toronto-based Katanga is a mineral exploration company.

Pan Orient's C$30 million deal

Also among Canadian resources deals, Pan Orient Energy Corp. negotiated a C$30 million stock deal Thursday.

The deal includes up to 8 million shares at C$3.75 apiece.

A syndicate of underwriters led by Orion Securities Inc. and Wellington West Capital Markets Inc. will place the shares.

The proceeds will be used for exploration and development of two existing concessions in Thailand.

Pan Orient's stock dropped 14 cents, or 3.47%, to close at C$3.90 (TSX Venture: POE).

The deal is scheduled to close on April 28.

Calgary, Alta.-based Pan Orient is an oil and natural gas exploration company.

Caspian Services raises $8 million

Related to the energy offerings, Caspian Services, Inc., which provides services to the oilfield industry, completed an $8 million unit deal with Firebird Global Master Fund, Ltd.; Firebird Avrora Fund, Ltd.; and Firebird Republics Fund, Ltd.

Caspian sold 1 million units of two shares and one warrants. Each warrant is exercisable at $5.00 for five years.

The company's stock remained unchanged at $4.95 Thursday (OTCBB: CSSV).

Located in Salt Lake City, Caspian provides oilfield services to oil and natural gas companies with operations in Kazakhstan and on the Caspian Sea.

Hemispherx's stock gains 7%

A day after completing a $50 million equity line with Fusion Capital II, LLC, Hemispherx Biopharma, Inc.'s stock advanced by more than 7%.

The stock gained 7.12%, or 21 cents, to close at $3.16, losing a penny in after-hours trading (AMEX: HEB).

The stock edged up slightly, gaining a penny to end at $2.95 on Wednesday when the deal was announced.

Under the terms of the 25-month equity line, Fusion may buy shares of Hemispherex at a price equal to the lesser of lowest trade prices immediately before a draw or the three lowest closing stock prices for the 12 trading days before a draw.

Based in Philadelphia, Hemispherx is a biopharmaceutical company focused on treatments for viral and immune disorders.

Palatin's stock edges up

Another biopharmaceutical company, Palatin Technologies, Inc., saw its stock move up a day after announcing a placement.

The company's stock improved by 4 cents, or 1.6%, to settle at $2.54 (AMEX: PTN).

Palatin's stock advanced 6.38%, or 15 cents, to end the day at $2.50 (AMEX: PTN). On April 11, the stock lost 9 cents to end at $2.35.

In the direct offering, Palatin plans to sell units of one share and one warrant for 0.3 of a share at $2.44 each to a group of investors led by Vivo Ventures.

The deal is expected to close April 17.

The shares associated with the units will be offered under Palatin's shelf registration.

Proceeds will be used for general corporate purposes.

The deal was lauded on Wednesday by buysiders, with one claiming the stock is likely to improve over the coming years.

Palatin, based in Cranbury, N.J., is a biopharmaceutical company focused on the development of melanocortin-based therapeutics used to treat male and female sexual dysfunction.

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