VOG.L Regulatory News (VOG)

29 Jan 2008 07:00

Victoria Oil & Gas PLC29 January 2008 29 January 2008 Victoria Oil & Gas Complete £20 million Fundraising • Allotment of 145,271,318 new shares through a £15.25 million equity raising and conversion of an existing convertible bond • Issue of further $2 million convertible loan notes on admission of new shares, with a further $8 million loan notes available subject to conditions • Blackwatch and GeoDynamics to undertake full technical review of West Medvezhye and Kemerkol operations with the Company Victoria Oil & Gas Plc ("Victoria" or "the Company")(AIM:VOG), the oil and gascompany focused in the Former Soviet Union, announces today that it hascompleted the allotment of 145,271,318 new ordinary shares of 0.5 pence each inthe Company ("the Shares") as part of the £20 million fundraising that wasannounced on 21 December 2007 (the "Fundraising"). The Shares rank pari passu in all respects with the existing issued ordinaryshares in the Company. Application has been made to the London Stock Exchangefor the Shares to be quoted on AIM and it is expected that admission of theShares will be on 1 February 2008. Following admission, the total issued sharecapital of the Company will be 269,507,991 ordinary shares with voting rights. 101,666,667 ordinary shares were placed at a price of 15 pence per share withboth institutional and private investors raising £15.25 million before expenses(the "Placing"). The principal placee was a special purpose vehicle, NoorPetroleum Limited (the "SPV") backed by a consortium of investors led by FalconPetroleum Limited and managed by Noor Capital PSC & Associates. Another placeewas HJ Resources Ltd, which subscribed for 6,666,667 ordinary shares to be heldon behalf of a discretionary trust, of which Kevin Foo is a possiblebeneficiary. On admission, HJ Resources Ltd's new total holding in the Companywill be 9,915,396 shares representing 3.68% of the issued ordinary share capital The remaining 43,604,651 ordinary shares were allotted to the holder of theCompany's £18.75 million Secured Guaranteed Convertible Bond due 2009 (the "Bond") on partial conversion of the Bond at a price of 25 pence per share. Following the issue of these shares and the repayment of the remaining £8 million from the proceeds of the Fundraising, the Bond will have been retired in full. On admission of the Shares, the SPV will subscribe for $2 million convertibleloan notes due 2012 (the "Notes") and subject to approval, the Board of Victoriawill appoint four new directors: Mr Rashed Al-Suwaidi and Mr Philip Rand, asproposed by the SPV; and Mr George Donne and Mr Mukhtar Tuyakbayev. The SPV willsubscribe for a further $8 million of the Notes on ratification of the extensionof the Company's West Medvezhye licence. The Company also intends to enter into arms-length contracts with BlackwatchPetroleum Services Limited ("Blackwatch") and GeoDynamics Research s.r.l ("GeoDynamics") for their advice on the development of Victoria's assets in Russiaand Kazakhstan. A full review of all data available on both the West Medvezhyeand Kemerkol licences will be undertaken with Victoria's technical team tore-evaluate the existing interpretations and re-define the developmentstrategies for 2008. The focus at West Medvezhye will be on fully delineating the next targetlocation, Well 105, to ensure the highest possible chance of success. This willinclude running trials of GeoDynamics' passive seismic technology, which is asyet untried in this region. For Kemerkol, the existing 2D and 3D seismic data will reinterpreted and ifwarranted, a new passive seismic survey performed to improve the subsurfaceassessment and define better potential drilling targets for 2008. The short-termgoal will be to increase production to the point where Victoria could apply foran export licence and so receive export prices for the oil produced. Blackwatch will also assist the Company in its on-going review of newacquisition opportunities to boost production levels and increase Victoria'sproven reserve base. A presentation with further information on both Blackwatchand GeoDynamics and their proposed plans for the Company's assets can be foundon the Company's website at www.victoriaoilandgas.com Commenting today on behalf of Blackwatch, Managing Director Sam Metcalfe said, "We have entered into this transaction because we believe in the potential ofVictoria's assets and that, in partnership with GeoDynamics, we can assist inthe realisation of that potential. Whilst it must always be remembered thatthere are no certainties in exploration, with the application of enhancedtechnical management and passive seismic technology we believe that Victoria cansignificantly reduce exploration risk and thus improve the success rate." Also commenting today on the Fundraising, Chairman Kevin Foo said, "These eventssignal a major turnaround for Victoria Oil & Gas. We have retired the old bondand provided sufficient working capital for 2008. We will have access tofirst-class technical resources in Blackwatch and secured a valuable partnershipwith GeoDynamics. Most importantly, we have strengthened our Board considerablywith highly-respected and professional people. The re-build has commenced." For further information, please contact: Kevin Foo / George Donne Jonathan Charles / Ed PortmanVictoria Oil & Gas Plc Conduit PR+44 (0)207 921 8820 +44 (0)207 429 6607 +44 (0)7733 363 501 Toby Hayward / Oliver Griffiths Andrew Hayes / Vladimir RusinovJefferies International Renaissance Capital+44 (0)207 029 8000 +44 (0)207 367 7777 This information is provided by RNS The company news service from the London Stock Exchange