Sirius Petroleum the investing company focused on oil and gas exploration and development opportunities is pleased to announce that it has raised a total of £1,035,000 (net of fees) through a Placing of 250 million new ordinary shares and a Subscription of 25 million new ordinary shares with new and existing investors at 0.4 pence per share.
New Funding to support the Ororo Field Well Permit Application
- In collaboration with Guarantee Petroleum and Owena Oil & Gas, the Company will initiate application process to the Department of Petroleum Resources Nigeria (“DPR”) for a Well Permit for the Ororo-2 well
- Company will commence work to obtain an up-to-date Environmental Impact Assessment (“EIA”)
- In addition, the outstanding Calvet Facility has been reduced by £500,000 resulting in less dilution of shareholders’ interests by 100 million shares and Calvet have agreed to a six month lock-in of its current shareholding
- Funding provides additional general working capital.
Bobo Kuti, Chief Executive, said: “I have set out a near term set of objectives for Sirius which sees all of our plans and recent activity come together and should lead to significant developments that bring Sirius closer to developing the Ororo Field.”
“A collaborative approach with Guarantee Petroleum and Owena Oil & Gas provides multiple levels of technical and in-country knowledge and, in collaboration with Havoc Partners, aligns with our strategy to progress the development of our first asset.”
“The Nigerian oil and gas industry has the full support of the new government administration which has re-focused the regulators, the Nigerian National Petroleum Corporation and the Department of Petroleum Resources, to work closely with indigenous companies to bolster the nation’s natural resources production. This initiative ties in with our strategy to build a significant portfolio of producing assets through local partnerships.”
The Funding will be used to pay approved costs incurred by Sirius’s partners in accordance with certain terms of the Financial & Technical Services Agreement (“FTSA”) to allow the Company to apply to the DPR for a Well Permit. Sirius will also apply for certain local regulatory approvals and initiate work to obtain an up-to-date EIA. The Funding will also provide general working capital (depending on the timing of raising the Project finance in relation to the Ororo-2 well, additional general working capital may be required).
Further to Sirius’s announcement of 12 February 2015, the Parties have been working closely together with the DPR with regard to clarifying the licensing obligations in relation to the Ororo Field. The Sirius directors believe that the Well Permit, if granted, would be a significant step forward in this regard. A further announcement will be made in due course.
In addition to applying for the Well Permit, Guarantee Petroleum, Owena Oil & Gas and Sirius (together “the Parties”) intend to apply to the Ministry of Petroleum Resources in Nigeria to legally ratify Sirius’ 40 per cent. participatory interest in the Ororo Field. This is subject to the amendment or waiver of certain terms of the FTSA, which have been highlighted by a recent review of the FTSA by the Parties, in order to confirm each of the Parties rights and economic interests under the FTSA, which comprises Sirius’ 40% interest, Guarantee Petroleum’s 32% interest, and Owena Oil and Gas’ 28% interest.
In conjunction with the Placing, Calvet International Limited (“Calvet”), an international family investment office, in continued long term support of the Company’s development has agreed to reduce by £500,000 the total amount of the Calvet loan facility (“Facility”) that Calvet can deliver to the Company and convert into ordinary shares of the Company. The undrawn Calvet Facility will therefore now be £700,000. This, in turn, will reduce the potential dilution of shareholders’ interests by 100 million shares. Furthermore, Calvet has agreed to a lock-in of its current shareholding in the Company for a period of six months from 22 September 2015 and, other than with the consent of the Company, it will not dispose of any rights over or interest in such shares for that period.
Issue Of Equity
Application has been made for the 275 million Funding Shares (representing 20.5 per cent. Of the current issued share capital) to be admitted to trading on AIM, which is expected to occur on, or around, 29 September 2015. Following admission of the Funding Shares, the Company’s enlarged issued share capital will comprise 1,613,562,856 ordinary shares. This figure of 1,613,562,856 ordinary shares may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA’s Disclosure and Transparency Rules.
The Financial & Technical Services Agreement (FTSA) refers to the agreement dated 10 October 2011, as previously announced by the Company.
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