17 Jun 2009 07:00
17 June 2009
Victoria Oil & Gas Plc
('Victoria Oil & Gas' or 'the Company')
(AIM: VOG)
New Funding Package of over £10 million and Convening of Extraordinary General Meeting
Victoria Oil & Gas completes an equity placing of £5,298,750 before expenses Agreement to increase of Standby Equity Distribution Agreement with Yorkville Advisors to £10 million Sufficient funds in place to take Company to first gas production Extraordinary General Meeting ("EGM") to be convened on Monday 13 July 2009Victoria Oil & Gas Plc, the AIM quoted oil and gas exploration company with assets in Cameroon and the FSU is pleased to announce that it has raised £5.3 million before expenses (£5.1 net of expenses) by way of a two-tranche equity placing (the "Placing") and has also increased its Standby Equity Distribution Agreement announced on 2 April 2009 from £5 million to £10 million (the "New SEDA"). This funding package, which marks the completion of the funding exercise begun earlier in April, will be used to drill the first well and generate first production at the Company's Logbaba project in Cameroon.
The Company has placed 100,000,000 ordinary shares ("the Initial Placing Shares") at a price of 3 pence each ("Placing Price") (together, "the Initial Placing") for gross proceeds of £3,000,000 through Fox-Davies Capital Limited ("FDC"). The Initial Placing Shares will be allotted utilising the Company's existing authorities.
To enable the issue of the remainder of the new ordinary shares pursuant to the Placing, the Company will be required to increase its authorities to issue new ordinary shares. Shareholder approval for the placing of a further 76,625,000 ordinary shares ("the Secondary Placing Shares") at the Placing Price (the "Secondary Placing"), to raise an additional £2,298,750 before expenses, shall therefore be sought at an EGM to be held at 11 a.m. on Monday 13 July 2009. Approval will also be sought for the allotment of a further 16,385,992 ordinary shares (the "Additional Shares") to advisers and in relation to the Promissory Notes (see below).
Formal notice of the EGM is being posted to shareholders and is available from the Company's website at www.victoriaoilandgas.com. Completion of the Secondary Placing will therefore be conditional on, inter alia, the passing of the resolutions to be proposed at the EGM.
The Company has agreed the New SEDA with YA Global Master SPV Limited, doubling its existing facility to £10 million. The New SEDA enables the Company, at its discretion over the next 30 months, to draw down funds under the New SEDA in tranches as and when it deems appropriate and in accordance with restrictions set by the terms of the Agreement.
Victoria Oil & Gas will utilise the funds from the Initial and Secondary Placings and the New SEDA at the Logbaba project in Cameroon. To secure additional financial support for the project, the Company has been negotiating with a consortium, which has offered to provide not only the rig, but also drilling services and finance for certain wellsite equipment. A binding contract has been signed for the rig and other contracts are expected to be executed in the near future. The rig, which has been inspected and moved to its departure point, is expected to arrive in Douala by mid-July. Further information on the latest status of the Logbaba project can be found in the Chairman's letter to shareholders as part of the EGM notice.
The Company is also pleased to announce that it has signed amendments to two promissory notes with a total value of US$350,000 (the "Promissory Notes") issued by its subsidiary, Bramlin Limited. Under the amendments, 5,052,658 new ordinary shares shall be issued to the note holders at the Placing price in lieu of repayment of the Promissory Notes, less legal expenses, and approval for this issue of shares shall be sought at the EGM. HJ Resources Ltd, a company owned by a discretionary trust of which Kevin Foo and his wife are possible beneficiaries, is one of the note holders.
The Secondary Placing will include 9.9 million ordinary shares to be subscribed for by Directors and senior managers of the Company and 0.6 million ordinary shares alloted in relation to the Promissory Notes. The effect of the above on the holdings of the Directors is as follows:-
| Secondary Placing Shares to be subscribed | Total Shareholding in VOG following the Secondary Placing | ||
| Kevin Foo | 7,857,783 | 37,097,295 | 5.3% |
| George Donne | 833,333 | 2,283,140 | 0.3% |
| Philip Rand | 833,333 | 833,333 | 0.1% |
The shares are held by H J Resources Ltd on behalf of a discretionary trust, of which Mr Foo and his wife are possible beneficiaries
Application will be made to the London Stock Exchange for the Initial Placing Shares to be admitted to trading on AIM. It is expected that admission will become effective and that trading will commence on 23 June 2009.
The Initial Placing Shares, the Secondary Placing Shares and the Additional Shares (the "New Ordinary Shares") represent 38.2 per cent of the existing issued share capital of the Company. Following the admission of the Initial Placing Shares to trading on AIM, the Company will have 605,855,390 ordinary shares in issue. The New Ordinary Shares will rank pari passu in all respects with the existing ordinary shares.
Victoria Oil & Gas's Chairman Kevin Foo commented: "Today's tough markets have created two types of companies, those with financial solutions and those without. We recognised this and our efforts have been both tenacious and innovative and we have, in 2009, raised over £16 million and reduced payables by £1.6 million. This has been very satisfactory because both shareholders and new investors recognise the massive underlying value of this company. The drilling rig for Logbaba is secured and scheduled to be on the water to Cameroon before the end of this month and drilling is scheduled to commence 60 days from then."
For further information, please contact:
Victoria Oil & Gas Plc - Tel: +44 (0) 20 7921 8820
Gerge Donne / Kevin Foo
Strand Partners Limited - Tel: +44 (0) 20 7409 3494
Simon Raggett / Angela Peace
Fox-Davies Capital - Tel: +44 (0) 20 7936 5220
Daniel Fox-Davies / Oliver Stansfield
Conduit PR - Tel: +44 (0) 20 7429 6607
Jonathan Charles / Ed Portman
Background Information on Victoria Oil & Gas Plc:
Victoria Oil & Gas is an independent oil and gas exploration and production company with projects in Africa and the FSU. The Company's principal assets are 60% of the Logbaba gas and condensate project in Cameroon and 100% of the West Medvezhye gas field in Siberia, Russia. Logbaba is located in Douala, the economic capital of Cameroon. The field was discovered in the 1950s and all four exploration wells flowed gas at rates of up to 62 million cubic feet per day. West Medvezhye is situated in the prolific Yamal-Nenetsk hydrocarbon region in Siberia. An independent reserve audit estimated prospective resources for the field of over 1.1 billion barrels of oil equivalent.
Further information on the company can be found at: http://www.victoriaoilandgas.com