UPDATE 1-BPZ Resources to raise $140 mln via note offering

* Says to use net proceeds to raise capex, working capital * Shares fall 9 percent after-market

Feb 2 (Reuters) - BPZ Resources Inc (BPZ.N) said it will raise $140 million through a private placement of its convertible senior notes and use the proceeds to increase its capital expenditure and working capital, and reduce its debt.

The oil and gas exploration and production company said the interest rate, conversion rate and other terms are to be determined by negotiations with the initial purchaser.

The company said it intends to offer the initial purchaser of the notes, which are due 2015, a 30-day over-allotment option of up to an additional 15 percent of the aggregate principal amount of the notes.

Shares of the company were down 54 cents at $5.70 in trading after the bell. They closed at $6.24 Tuesday on the New York Stock Exchange. (Reporting by Thyagaraju Adinarayan in Bangalore; Editing by Anne Pallivathuckal)