Canadian player Argosy Energy is set to raise C$5.3 million (US$4.86 million) in a discount equity sale so help it expand its Alberta projects.

The explorer has agreed to sell 4.2 million common shares via a bought deal to a syndicate of underwriters led by National Bank Financial at C$1.25 each.

The offer price represents a discount of 7% to the stock's Tuesday's close.

The underwriters also have an option to buy up to 600,000 common shares at the offer price to cover over-allotments, Argosy said in a statement.

Management, directors and certain insiders have agreed to buy about 1.7 million shares at the offer price, Argosy Energy said.

The offering is expected to close on or about 17 September.

Shares of the Calgary, Alberta-based company closed at C$1.35 Tuesday on the Toronto Stock Exchange.