PCI.L Regulatory News (PCI)

30 Apr 2009 07:00



Not for release, publication or distribution in or into the United States, Australia, Canada, the Republic of South Africa or Japan. This announcement is not an offer for sale of securities in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended. The issuer of the shares has not registered, and does not intend to register, any portion of the offering in the United States and does not intend to conduct a public offering of its securities in the United States.

Petroceltic International plc 

("Petroceltic" or the "Company")

US$40 million Placing 

Petroceltic is pleased to announce that it has raised gross proceeds of up to US$40 million or £27.5 million by way of a conditional placing of up to 392,464,000 new ordinary shares ('Placing Shares') at a price of Stg 7p (the 'Placing'). 

Highlights:

Placing to raise US$40 million (£27.5 million) from both existing and new institutional shareholders

Proceeds to be used to support the Company's imminent drilling programme in Algeria and to accelerate the Company's ongoing appraisal and drilling activities in Italy 

Brian O'Cathain, Chief Executive of Petroceltic commented:

 "The funds raised through this placing give the Company the financial flexibility to underpin the 2009 Algerian drilling programme and at the same time to put in place the financial commitments needed to secure the appraisal and drilling programme planned for Italy in 2010/2011. We were particularly pleased that the placing was oversubscribed, despite the difficult market conditions, and we would like to thank our existing and new shareholders for their continued support" 

A conference call for analysts and institutional investors will take place at 11.00 am today. The conference call will be hosted by Brian O'Cathain, Chief Executive, and Alan McGettigan, Finance Director. For login details to the conference call, please contact Philip Dennis / Malika Shermatova at Pelham on +44 (0)207 337 1516 / +44 (0)207 337 1534. 

The Company's final results announcement for the year ended 31 December 2008 has been issued separately this morning.

For further information please contact

THE PLACING

Petroceltic has agreed the terms of a conditional placing of up to 392,464,000 new ordinary shares of €0.0125 each ("Ordinary Shares") to raise gross proceeds of up to US$40 million or £27.5 million (the "Placing"). The Placing was arranged by Mirabaud and Davy

The Placing is being executed in three tranches:

The first tranche of the Placing consists of a conditional placing of 190,619,000 Ordinary Shares for cash at a price of Stg 7p each (the 'First Tranche Placing'). The First Tranche Placing is conditional only on admission of such Placing Shares to trading on the AIM Market of the London Stock Exchange ('AIM') and the IEX Market of the Irish Stock Exchange ('IEX').

The second tranche of the Placing consists of a conditional placing of 114,174,000 Ordinary Shares for cash at a price of Stg 7p (the 'Second Tranche Placing'). The Second Tranche Placing is conditional on admission of such Ordinary Shares to trading on AIM and IEX and on receipt of necessary authorities from shareholders to be sought at the Company's Annual General Meeting to be held on 3 June 2009 ('AGM'). A circular convening the AGM will be sent to shareholders shortly.

The third tranche of the Placing consists of a conditional placing of up to 87,671,000 Placing Shares for cash at a price of Stg 7p, which are subject to a clawback provision (the 'Third Tranche Placing'). The Third Tranche Placing is conditional on admission of such Placing Shares to trading on AIM and IEX and receipt of necessary authorities from shareholders at the AGM. 

The shares to be issued pursuant to the Third Tranche Placing (the 'Third Tranche Placing Shares') are subject to clawback because Iberdrola, the Company's largest shareholder with a shareholding of approximately 22.3% of the Company's existing issued share capital, has the right to participate on a pro-rata basis in any equity fundraising carried out by the Company in respect of which it would not otherwise have a pre-emptive right to participate in. The First Tranche Placing and the Second Tranche Placing give rise to such a participation right for Iberdrola. Accordingly, Iberdrola will be offered the opportunity to subscribe for the Third Tranche Placing Shares, which equates to that amount required for them to retain their shareholding percentage following the First and Second Tranches. The provisional allotment of the Third Tranche Placing Shares is, accordingly, subject to a pro rata clawback. Iberdrola has a period of 21 days within which to elect to subscribe for the Third Tranche Placing Shares.

The Placing Shares represent approximately 40.6% of the existing issued share capital of the Company and approximately 28.9% of the enlarged share capital of the Company.

USE OF PROCEEDS

The gross proceeds of the Placing, amounting up to US$40 million or Stg£27.5 million before expenses, will be used in the first instance to support the Company's drilling programme in Algeria (which is due to commence in mid-May) and the continuation of ongoing appraisal of the Company's Algerian acreage.

The remainder of the proceeds will be used to accelerate the Company's appraisal and drilling programmes in Italy, for further development of the Company's Italian acreage portfolio and for general corporate purposes. The Company intends to acquire additional 2D and 3D seismic data in the Po Valley and the Central Adriatic regions and is planning to drill up to three wells on its Italian acreage over the next 24 months.

Algeria

Petroceltic is focused on four prospective areas in the Isarene permit in Algeria, with combined contingent potential resources of up to 6 TCF of gas. Three of the prospects are considered appraisal areas as a result of existing oil & gas discoveries made by the Company and previous operators. The fourth area is an exploration target. 

Petroceltic has carried out extensive work on its Algerian permits including the recent acquisition and processing of 900km² Wide Azimuth 3D seismic over the Ain Tsila Ridge area. The clearer data provided by this new seismic will be used to target well locations in areas of better flow potential then previous wells drilled some 20 to 40 years ago. A similar approach by BP and Sonatrach has proved successful in the adjacent Tiguentourine Field. 

The Company plans to drill between 5 and 7 wells over the course of its forthcoming programme, which is expected to take approximately 9-10 months to complete. The programme will be largely funded from the proceeds of the US$55m investment in Petroceltic by Iberdrola, the world 4thlargest electricity company, in June last year. 

Italy

Italy is the Company's second main area of focus, after Algeria, with an existing assets portfolio comprising 7 permits (4 operated) in the Po Valley, 11 off shore exclusive applications (10 operated) in the Central Adriatic and Sicily Channel and 1 onshore exclusive application (operated). 

The Company intends to use a majority of the funds raised through this placing to further mature a number of highly attractive key assets in Italy and to carry out an ongoing appraisal and drilling programme. The Company is currently in the process of high grading assets from within the Italian portfolio that offer the greatest potential step change in value.

As part of maturing certain of these assets further, the Company intends to acquire additional 2D and 3D seismic data in the Po Valley and the Central Adriatic regions. Petroceltic plans to drill its first well in Italy in 2010 (subject to permitting and rig availability) and to drill up to three wells on its Italian acreage over the next 24 months.

SHARE ADMISSION & TRADING

Application has been made to the London Stock Exchange and Irish Stock Exchange for 190,619,000 new ordinary shares of nominal value €0.0125 each ("Ordinary Shares") in the capital of the Company to be admitted to trading on AIM and IEX. Dealing is expected to commence in the Ordinary Shares on 6 May 2009. These Ordinary Shares rank pari passu in all respects with the existing Ordinary Shares of the Company.

Subject to shareholder approval, it is expected that admission of up to 201,845,000 additional new ordinary shares of nominal value €0.0125 each to AIM and IEX will occur on or around 8 June 2009. These Ordinary Shares will, when issued, rank pari passu in all respects with the existing Ordinary Shares of the Company.

The annual report and notice of AGM, which will include resolutions in relation to the Placing, will be posted to shareholders shortly. The AGM will be held on Wednesday, 3 June, 2009, at 12.00 noon at the Herbert Park Hotel, Ballsbridge, Dublin 4.

-ENDS-

This announcement is for information purposes only and shall not constitute an offer to buy, sell, issue, or subscribe for, or the solicitation of an offer to buy, sell, issue, or subscribe for any shares, nor shall there be any sale of shares in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. This announcement has been issued by and is the sole responsibility of Petroceltic.

This announcement contains (or may contain) certain forward-looking statements with respect to certain of Petroceltic's plans and its current goals and expectations relating to its future financial condition and performance and which involve a number of risks and uncertainties. Petroceltic cautions readers that no forward-looking statement is a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking statements. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements sometimes use words such as 'aim', 'anticipate', 'target', 'expect', 'estimate', 'intend', 'plan', 'goal', 'believe', or other words of similar meaning. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances a number of which factors are beyond Petroceltic's control. As a result, Petroceltic's actual future results may differ materially from the plans, goals, and expectations set forth in the forward-looking statements. Petroceltic expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained in this announcement to reflect any changes in Tullow Oil's expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based. 

No representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by J&E Davy ("Davy"), Mirabaud Securities Limited ("Mirabaud") or by any of their respective affiliates or agents as to, or in relation to, the accuracy or completeness of this announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed.

Davy, which is regulated in Ireland by the Financial Regulator, is acting exclusively for Petroceltic and for no-one else in connection with the Placing, and will not be responsible to anyone other than Petroceltic for providing the protections afforded to customers of Davy or for providing advice to any other person in relation to the Placing or any other matter referred to herein.

Mirabaud, which is regulated in the United Kingdom by the Financial Services Authority of the United Kingdom, is acting exclusively for Petroceltic and for no-one else in connection with the Placing, and will not be responsible to anyone other than Petroceltic for providing the protections afforded to customers of Mirabaud or for providing advice to any other person in relation to the Placing or any other matter referred to herein.

The distribution of this announcement and the offering of the Placing Shares in certain jurisdictions may be restricted by law. No action has been taken by Petroceltic, Davy or Mirabaud that would permit an offering of such shares or possession or distribution of this announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Persons into whose possession this announcement comes are required by Petroceltic, Davy and Mirabaud to inform themselves about, and to observe such restrictions.

This announcement is not for distribution directly or indirectly in or into the United States (including its territories and possessions, any State of the United States and the District of Columbia), Canada, Australia or Japan or any jurisdiction into which the same would be unlawful. This announcement does not constitute or form part of an offer or solicitation to purchase or subscribe for shares in the capital of Petroceltic in the United States, Canada, Australia or Japan or any jurisdiction in which such an offer or solicitation is unlawful. In particular, the Placing Shares referred to in this announcement have not been, and will not be, registered under the Securities Act and may not be offered or sold in the United States absent registration or an exemption from the registration requirements under the Securities Act. No public offering of securities of Petroceltic is or will be made in connection with the Placing in Ireland, the United Kingdom, the United States or elsewhere.