a Petroleum PLC Entry into conventional US onshore oil & gas RNS Number : 8400R Matra Petroleum PLC 31 October 2013
﻿ Matra Petroleum Plc ("Matra" or the "Company")
Entry into conventional US onshore oil and gas sector via phased acquisition of interest in US Joint Venture Company
Suspension of Trading
Matra, the oil and gas investing company, is pleased to announce that its wholly owned subsidiary, Matra Petroleum U.S.A., Inc. ("Matra USA"), has entered into an agreement which allows it to make a series of investments into the US onshore oil and gas sector (the "Purchase Agreement"). Under the Purchase Agreement, Matra USA, through a series of investments, may acquire up to 38,746 net acres, across 50 leases located in the Texas Panhandle, with internally estimated remaining recoverable reserves of 10,575 Mboe, averaging 68% oil, for an aggregate consideration of up to $28.2 million. The leases in aggregate have existing well stock of 221 wells and an estimated 379 new well locations. Current production across the leases is approximately 60 boepd.
The Purchase Agreement is structured such that Matra USA may undertake a phased acquisition of the interests outlined above through a joint venture vehicle. An initial investment of $1.5 million (the "Phase 1 Investment") has been made and a further two phases are expected to be completed by the second quarter of 2014.
The completion of all the phased investments as contemplated by the Purchase Agreement would constitute a Reverse Takeover under the AIM rules for Companies ("AIM Rules") and accordingly the trading in the Company's ordinary shares is today being suspended. Included in the re-admission document will be an independent competent persons report covering the leases.
The Company believes that the US conventional onshore oil and gas market represents a compelling investment opportunity as it offers access to low risk production at attractive valuations whilst being within a stable fiscal and legal regime.
The Company's management team is experienced in extracting economic value from mature and depleted fields primarily through using modern low cost drilling and redevelopment techniques. The Company is accordingly initially focussing on the Texas Panhandle region of the USA where there exists shallow conventional reservoirs (with reservoir depths up to 700 meters), production history since 1920, high exploration maturity and relatively low development and operating costs. The Company believes there to be other consolidation opportunities in the region.
Maxim Barskiy, CEO, commented:
"Over the last year and a half we have invested a great deal of time and effort in reviewing different projects and believe this opportunity will become the first step in the realization of our strategy of building a mid-sized independent E&P Company.
Datafeed and UK data supplied by NETbuilder and Interactive Data.
While London South East do their best to maintain the high quality of the information displayed on this site,
we cannot be held responsible for any loss due to incorrect information found here. All information is provided free of charge, 'as-is', and you use it at your own risk.
The contents of all 'Chat' messages should not be construed as advice and represent the opinions of the authors, not those of London South East Limited, or its affiliates.
London South East does not authorise or approve this content, and reserves the right to remove items at its discretion.