MEDIA/NEWS NAVIGATION

Entry into the Ororo Joint Operating Agreement, Proposed Equity Placing and AIM Readmission

30 Nov 2017

Sirius Petroleum Plc

(“Sirius” or the “Company”)

Entry into the Ororo Joint Operating Agreement

Proposed Equity Placing raising approximately US$9.5m

Application for Readmission to Trading on AIM

Posting of Admission Document and Notice of General Meeting

Sirius Petroleum (AIM: SRSP), the investing company focused on oil and gas exploration and development opportunities in Nigeria, is pleased to announce the following:

Highlights

• Proposed placing of 723,700,000 new Ordinary Shares to raise gross proceeds of approximately US$9.5 million at a price of 1 pence per share as follows:

o Unconditional Placing of 394,000,000 new Unconditional Placing Shares, and

o Conditional Placing of 329,700,000 new Conditional Placing Shares

• Convertible Loan Facility of US$12 million with London Oil & Gas Limited (“LOG”) (“the LOG Convertible”) carrying a coupon of LIBOR plus 6.5 per cent. and partially convertible at a 50 per cent premium to the Issue Price of the Placing. LOG is wholly owned by London Power Corporation plc and is an established institutional investor in the international oil and gas sector http://www.lpcplc

• The combined proceeds of the proposed Placing and the LOG Convertible (“the Fundraising”) and the commitments of the Company’s commercial partners under previously announced Commercial Agreements will allow the Company to drill the Ororo-2 well and bring it into production in accordance with the Ororo Joint Operating Agreement (“JOA”).

• The Company expects to commence an initial programme to drill the Ororo-2 well in Q1 2018 and access the contingent oil and gas resources in the Ororo field with an early production scheme through an extended well test generating an initial estimated rate of approximately 2,700 bopd;

• The Company is in discussions with REYL & Co (UK) LLP, part of the Swiss banking group REYL et Cie, which has CHF 13bn AUM, to structure a contingent liquidity facility of up to US$100 million which would be backed by the securitisation of receipts under the BP Prepayment and Offtake Agreement.

• On confirmation that the Ororo-2 well production rates of the hydrocarbon reservoirs are in line with those estimated in the CPR, and conditional on the Company securing further financing, by way of the non-dilutive REYL facility, the Company will undertake a multi well campaign to fully develop the Ororo Field, involving the drilling of up to four further wells and the installation of permanent production, processing and pipeline facilities at the Field.

The entry into the JOA enables the Company to transition from an investing company into an operating company and as such Sirius is required under the AIM Rules for Companies to seek Shareholder approval and re admission of its Enlarged Share Capital to trading on AIM pursuant to AIM Rule 14 and, accordingly, the Company requires the approval by its Shareholders of the Proposals, such approval to be sought at the General Meeting, expected to be held at: at the offices of Fladgate LLP, 16 Great Queen Street, London WC2B 5DG and a notice of which will be contained in the Admission Document. If the Resolutions are duly passed at the General Meeting, the Company’s existing trading facility on AIM will be cancelled and the Company will apply for the Enlarged Share Capital to be admitted to trading on AIM.

The Company has today published the Admission Document and Notice of General Meeting to shareholders which will also be made available on the Company’s website at http://www.siriuspetroleum.com.


Bobo Kuti, Chief Executive, commented:

“We would like to thank all of our stakeholders for their support and we are now in a strong position as we seek shareholder approval to embark on the first operational stage of the Company’s asset – the Ororo Field.  This will be a transformational period for Sirius as we implement our strategy to develop proven oil and gas assets in Nigeria working alongside our World class partners.

“The proposed contingent liquidity facility, which is being structured by REYL, is intended as an innovative and competitive method of providing certainty of funding for the full development of the Ororo field. Alongside the BP offtake agreement, this will provide us with a continuity of funding for the full field, multi well drilling and production programme without suffering excessive dilution for equity shareholders, subject to us delivering the necessary production volumes.

“Our success in securing the vendor finance consortium, comprising world-class service partners, and the pre-pay facility and offtake agreement with BP underlines the confidence all stakeholders have in achieving the successful development of the Ororo asset. We are very excited by this development and anticipate replicating this structure as we seek to build a substantial portfolio of producing and near-production assets in Nigeria.”

You can read the full Admission Document here.

You can read the full announcement here.

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