Sirius Pet Regulatory News (SRSP)

25 November 2014

Sirius Petroleum Plc

("Sirius" or the "Company")

Term Sheet agreed for $15,000,000 Convertible Loan

Equity Funding of $15,000,000 Secured

Appointment of Merlin Partners LLP as Financial Advisor

Sirius Petroleum (AIM:SRSP) the investing company focussed on oil and gas exploration and development opportunities in Nigeria, is pleased to announce that it has now entered into a non-binding term sheet with Levant Energy Limited ("Levant" or the "Lender") for a Convertible Loan of $15,000,000 (the "Loan"). When agreed, the Loan will have a one year term and the Company has agreed a conversion price of 3 pence per share with an annual interest rate of 15 per cent. The Lender has the option to convert the Loan in part or in full, at any time during the period of the Loan. The Loan is subject to the completion of due diligence by the Lender, which is on-going. Sirius is working with Levant Energy to execute a definitive Loan Agreement by 16 December 2014. It should be noted that there is no guarantee that a definitive agreement will be entered into.

Levant Energy Limited is an independent company with investments in oil and gas projects in Africa, CIS countries and emerging markets. It is part of the Levant Group which has been actively involved in the natural resources and energy sectors for more than 20 years and has been an investor and founding shareholder as well as developer of various mining and exploration and oil services companies.  

Equity Funding

In addition, the Company has conditionally raised £9,375,000 before expenses (being approximately USD $15,000,000) by way of a conditional placing and subscription (the "Placing and Subscription"). If completed, Sirius will issue 375,000,000 new ordinary shares at a price of 2.5 pence per share. The Placing and Subscription are conditional on the Loan agreement being entered into and becoming unconditionally available for drawdown by the Company on, or before, 17th December 2014.

The terms of the Placing and Subscription are identical in all material respects, other than the placing being administered by the Company's broker, Cantor Fitzgerald Europe, and the subscription being direct with the Company. The 375,000,000 Placing and Subscription Shares will represent approximately 25.4 per cent. of the enlarged share capital, when issued.

The Loan and Equity Funding will enable the Company to fund its obligation under the Financial and Technical Service Agreement ("FTSA") as previously announced, with the intention of putting the Ororo Field (in OML 95) into production, of which Sirius has a 40% interest.

Financial Advisor

Sirius is also pleased to announce the appointment of Merlin Partners LLP ("Merlin") as the retained Financial Advisor to the Company. Merlin is an FCA regulated, London based, corporate finance advisory boutique whose clients include privately owned and public companies that have a specific focus on natural resources and energy. Merlin has been advising the Company on the Loan, the subscription, the appointment of Havoc Partners and the formation of the Technical Advisory Committee.

Commenting, Bobo Kuti, CEO, said "I am delighted that we have agreed terms, in principle, with Levant which represents a key partner for Sirius. In addition, I am very pleased with the response to the equity fundraising from new and existing shareholders. The total funding package of $30,000,000 exceeds our original target, and will put Sirius in a very strong financial position to develop the Ororo Field."

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