LINC Energy hopes to raise $200 million to explore and develop oil and gas prospects following strong drilling results.
Shares in the company were placed in a trading halt on Wednesday ahead of an announcement about raising capital through a convertible bond issue.
Brokers say Linc is looking at issuing bonds for between $3.40 to $3.50 per bond, with the ability to convert them into shares in 2018.
The company's shares have more than tripled in the past four months following a series of strong drilling results and speculation that Russian billionaire Roman Abramovich is interested in Linc's oil reserves.
Linc chief executive Peter Bond, who owns 40 per cent of Linc shares, last year confirmed he had dined with Mr Abramovich, who is also a Chelsea soccer team owner, to discuss his interest in Linc's energy business, which produces diesel and jet fuel from gas released from underground coal.
Since November 29 last year, shares in the company have surged from 69.5 cents to $2.67 on Tuesday.
Late last year the Australian Securities Exchange (ASX) asked Linc to explain a spike in the company's share price between December 7 and December 11.
Linc said it was not aware of any explanation for the price change.
IG Markets strategist Evan Lucas said the upcoming capital raising would allow the company to continue developing its oil and gas projects in the Cooper Basin in South Australia.
"The whole idea is to develop their exploration platforms," Mr Lucas said.
"The stock has rallied very hard, with their oil fields looking like they're on the way up."
Linc's recent drilling updates and speculation about its reserves had helped the stock.
Mr Lucas said $200 million could be used to take a feasibility study to a proposal and then into construction.
"The rumour about Abramovich being interested is a side issue," he said.
Linc owns traditional oil and gas assets in the United States and Australia, and also has separate clean energy and coal divisions with interests in China, Russia, Poland and the Ukraine.
Unless the ASX decides otherwise, Linc shares will remain in a trading halt until trading commences on Tuesday, April 2 or when the announcement is released to the market.
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