The institutional placement came from the issue of 17.8 million shares at 39c each, while a share purchase plan to eligible retail investors aims to raise another $8 million.

That offer is scheduled to open on Wednesday and more details will be mailed out to shareholders.

Endocoal chief executive officer Tim Hedley said the institutional placement was “significantly oversubscribed” with strong support from overseas institutional investors.

About $13.4 million from the equity raising program is expected to be spent on exploration activities.

“Endocoal remains on track to announce a resource upgrade at Orion Downs and a maiden resource at Rockwood in July 2011,” Hedley said.

The Orion Downs tenement is directly northwest of Xstrata’s Rolleston mine, and Endocoal previously flagged that its Meteor Downs project in this area would be targeting 1.5 million tonnes per annum as direct-ship thermal coal mine.

The explorer aims to complete a bankable feasibility study on Meteor Downs in the December quarter.

The total tenement area hosts 41.2Mt of resources split across two separate deposits.

The Rockwood project near Dysart in the Bowen Basin has an exploration target of 50-80Mt of indicated resources and Endocoal aims to produce a quality pulverised coal injection coal product in this area.

Endocoal shares are down 7.9% to 41c this morning.