CERP.L Regulatory News (CERP)

For Immediate Release

26 November 2015

LGO ENERGY PLC

("LGO" or the "Company")

Banking Update and Board Change

LGO Energy plc (LSE AIM: LGO) today provides an update on its banking arrangements following its announcements on 19 October 2015 and 3 November concerning Corporate funding activities.

LGO has now reached agreement with BNP Paribas ("Bank") on the crystallization of the existing funds drawn down on 17 March 2015 by its wholly owned subsidiary, Goudron E&P Limited ("GEPL"), through the Pre-Paid Swap Agreement announced in February 2015. The Company and Bank have agreed to early termination of the pre-paid swap in accordance with its existing terms and at its current value of US$ 10.8 million, including all future interest and fees.

Consequently, GEPL has entered into an indicative schedule of repayments which envisages the next three months (December 2015 to February 2016 inclusive) being at a reduced rate of US$75,000 per month, after which the remaining outstanding balance will be recovered over the following 19 months at a rate of approximately 5% per month. The existing covenants, including previous breaches until remedied, and the associated security arrangements will remain in place until all outstanding repayments have been made. The final repayment under the indicative repayment schedule is due no later than September 2017. LGO and the Bank continue to have regular constructive discussions aimed at assisting LGO to establish a secure and sustainable platform for future investment.

The Company is also working closely with its advisors in the USA, Wellford Capital Markets, LLC ("Wellford") and Height Securities, LLC ("Height") on strategic investments in the business. LGO expects to be actively discussing potential investments with clients of Wellford and Height during the next two months. Further updates will be provided in due course.

Neil Ritson, LGO's Chief Executive, commented:

"As the Company and the industry as a whole adjusts to the sustained low oil price environment, we are pleased to have reached this agreement with BNP Paribas. This will provide a firm financial platform for LGO to maintain the momentum of our oil production operations in Trinidad." 

In separate news LGO today announces that it has accepted the resignation of John (Iain) Patrick as a director of the Company with immediate effect.

Steve Horton, the Company's Chairman, commented:

"We would like to thank Iain for his contribution to the board and to wish him well with his various future endeavours."

Enquiries: