RNS out28 May 2019 08:09
Placing
London, United Kingdom and Calgary, Canada, May 28, 2019 - Canadian Overseas Petroleum Limited ("COPL" or the "Company") (XOP: CSE) & (COPL: LSE), an international oil and gas exploration and development company focused on sub-Sahara Africa, is pleased to announce the completion of placing by Shard Capital Partners LLP to raise gross proceeds of £497,000 (the "Placing"), pursuant to which the Company will issue 497,000,000 new common shares ("Placing Shares") at a price of 0.1 pence per Placing Share.
The Company intends to use the net proceeds of the Placing to fund its on-going general and administrative expenses thereby allowing it to progress development and financing plans underway for the OPL 226 project.
The Company's key asset is OPL 226 offshore Nigeria held by its Nigerian affiliate. COPL expects to bring three to four appraisal wells at OPL 226 onto production at a forecast rate of 6-10,000 bpd per well by the end of 2020.
Early Production Scheme in 2019
COPL expects to drill the first appraisal well at OPL 226 by late 2019, subject to regulatory approvals, and place it in production through an Extended Well Test ("EWT") utilising an Early Production System ("EPS"). This will be followed by the drilling of two to three additional similar wells on the prolific NOA Structure - all set to come on-stream by the end of 2020. This phase of the project would precede a full field development, after OML conversion offering significantly higher production levels. A full summary of the OPL 226 program was outlined in a Company announcement dated January 28, 2019.
Completion of this phase of the program will trigger conditional project financing arranged by ShoreCan for up to US$50 million for OPL 226 from Trafigura and the Mauritius Commercial Bank. The project finance is contingent on a production test delivering 6,000 bpd for 21 days and a minimum of US$20 million capital investment by ShoreCan. The Company is currently in advanced discussions with several global service providers regarding the provision of services for the early production scheme and concurrently in discussions with groups for the provision of project financing.
Netherland Sewell and Associates, Inc. ("NSAI") has evaluated COPL's Contingent Resources and Prospective Resources on OPL 226 and produced a report as of December 31, 2018. The report, dated March 15, 2019 was prepared under Canadian National Instrument NI 51-101. The findings highlight the inherent value in the asset and underpin the Company's ultimate potential. A summary of the report can be found in the Company's Annual Information Form ("AIF") dated March 28, 2019. The complete report can be viewed under the Company's name at www.sedar.com or on the Company's website www.canoverseas.com.
Application has been be made for the Placing Shares to be admitted to the Official List and to trading on the Main Market on 5 June 2019.
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