Why is the Seafarms (ASX:SFG) share price frozen on Thursday?

Seafarms is in the spotlight today after the company initiated a trading halt this morning

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The Seafarms Group Ltd (ASX: SFG) share price has been put in the freezer today as the company prepares to make an announcement to the market.

Upon requesting that its shares are halted from trade today, Seafarms noted it was aware of information regarding project costs. However, it was unable to prepare a market release before trade began on Thursday.

As a result, the Seafarms share price has remained unmoved from its previous close of 5.7 cents.

Let’s take a closer look at what we know of the prawn aquaculture company’s trading freeze.

Why is Seafarms frozen on Thursday?

The Seafarms share price’s trading halt has continued all day while the market awaits news of the company’s project costs.

Investors who are on the edge of their seats waiting for the update might have a while left to bite their nails. The company has until trade begins on Monday to release its update.

If it doesn’t do so, the company’s stock will be back to normal when the ASX opens on Monday.

Seafarms is currently working on Project Sea Dragon.

Project Sea Dragon will see the company developing 10,000 hectares of prawn production ponds and facilities across 5 separate locations. The project is expected to provide year-round production of black tiger prawns.

The company provided an update on the project within its results for financial year 2021.

Then, the company said it was seeking $150 million worth of construction debt and needed further debt for the development of Project Sea Dragon’s stage 1a.

Seafarms also recently completed a capital raise that saw it banking an additional $107.5 million, allowing it to begin construction on part of the project.

Project Sea Dragon’s first production is expected to occur in the third quarter of 2023. It has major project status from the federal, Western Australia, and Northern Territory governments.

Seafarms share price snapshot

This year hasn’t been good to the Seafarms share price.

It has fallen 36% since the start of the year. It is also 52% lower than it was this time last year.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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