Last checked at 8 May 2013 07:00
8 May 2013
San Leon Energy Plc
("San Leon" or the "Company")
San Leon Regains Ownership and Operatorship of Baltic Basin Concessions from Talisman Energy ("Talisman")
·; Acquires Talisman interests in Poland's Baltic Basin
·; San Leon retains assets in Talisman Energy Polska Sp. z o.o. ("Talisman Polska") valued at an estimated USD 10 million
·; San Leon regains operatorship of Baltic Basin concessions
·; Two-staged vertical well fracture in the Lewino-1G2 well planned on the Gdansk W concession in Q2 2013
San Leon is pleased to announce that it has regained 100% ownership of the Gdansk W and Braniewo S concessions, and increased its interest to 50% in the Szczawno concession, in Poland's Baltic Basin.
In February 2010, Talisman signed a farm-in agreement to earn a 30% working interest in the concessions in return for certain commitments, including drilling one well in each concession, with the option to increase its interest to 60% by drilling a further well in each concession. To date, Talisman has drilled one vertical well in each concession.
San Leon and Talisman have now signed an agreement whereby San Leon has acquired 100% of the shares of Talisman's subsidiary in Poland, Talisman Polska. In consideration, San Leon has assumed all assets and obligations of Talisman Polska. In addition to the interests in the three concessions, Talisman Polska's assets are valued at an estimated USD 10 million, and include cash and drilling equipment. Talisman Polska has no debt.
Talisman's decision to exit Poland is driven by its strategic priority to focus on production in its two core areas, the Americas and Asia-Pacific.
Talisman had carried San Leon on all expenses related to drilling the three wells in the Baltic Basin. San Leon will now use Talisman Polska's cash to fund the planned fracture of its Lewino-1G2 well in the Gdansk W Baltic Basin concession. The vertical fracture is intended to prove the unconventional gas potential of the Lower Silurian and Ordovician shales. Operations will begin as soon as permitting and regulatory approval is granted.
Executive Chairman, Oisin Fanning commented:
"Talisman's Poland exit has been inevitable since the company altered its strategy to concentrate on two core areas, the Americas and Asia-Pacific. It became clear to us that we had to regain control of the drilling programme as soon as possible to ensure the Baltic Basin work programme continued.
The Board believe that the deal is beneficial to our shareholders and we look forward to executing a fraccing programme in our Gdansk W Concession. There is still significant and continued industry interest in the Baltic Basin shale gas play, and we expect the results of our fraccing programme to attract further interest from potential farm-in partners."
For further information contact:
San Leon Energy Plc | Tel: +353 1291 6292 |
Oisin Fanning, Executive Chairman | |
John Buggenhagen, Exploration Director | |
Macquarie Capital (Europe) Limited | Tel: +44 (0) 20 3037 2000 |
John Dwyer | |
Fox Davies Capital | Tel: +44 (0) 20 3463 5000 |
Daniel Fox-Davies | |
Richard Hail | |
FirstEnergy Capital LLP | Tel: +44 (0) 20 7448 0200 |
Hugh R. Sanderson | |
David van Erp | |
Westhouse Securities (Nominated Advisor) | Tel: +44 (0) 20 7601 6100 |
Richard Johnson | |
Antonio Bossi | |
College Hill Associates | Tel: +44 (0) 20 7457 2020 |
David Simonson | |
Alexandra Roper |
www.sanleonenergy.com
Qualified person
John Buggenhagen, who has reviewed this update, has over 15 years experience in the oil & gas industry. He has a Ph.D. and M.Sc. in Geophysics from the University of Wyoming and a B.Sc. in Geophysics from the University of Arizona. He is currently the Director of Exploration for the San Leon Energy Group and based in San Leon's Warsaw office in Poland.