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Operational & Corporate Update

5 Oct 2022 09:15

RNS Number : 8671B
Victoria Oil & Gas PLC
05 October 2022
 

5 October 2022

Victoria Oil & Gas Plc

("VOG" or the "Company")

 

Operational & Corporate Update

 

Victoria Oil & Gas Plc, whose wholly owned subsidiary, Gaz du Cameroun S.A. ("GDC"), is the onshore gas producer and distributor with operations located in the port city of Douala, Cameroon, provides shareholders with a brief update on operations and corporate matters. 

 

Logbaba

Gas production continued in July & August at strong levels of above 5.5 MMscf/d, including the usually slower month of August, which was 10% up on last year.

 

Matanda

Well site and access road civil works preparations continue with the primary focus on community engagement along the access road whilst contractors wait for the rainy season to come to an end. We have not yet been able to conclude a contract on acceptable terms with the rig owner of the Chad-based rig mentioned in earlier publications, so the Company is pursuing an alternate from the tendering exercise. The Company is still seeking a partner to share the cost and risk of the commitment well.

 

La-108 Insurance Claim

The Company continues to pursue the insurance claim for the well control incident that occurred in March, 2017.

 

RSM Litigation

Following the Partial Final Award in April and the Addendum in July, the Company continues its settlement discussions with RSM, including recent face-to-face discussions in the U.S. Such discussions have been cordial and constructive, and a framework for settlement has been proposed with a view to signing a term sheet this month, though there can be no guarantee of concluding this or subsequent legal documentation leading to an agreement. Meanwhile the parties, who are partners in the Logbaba project, continue to work together to maximise the value of the Logbaba field.

 

Consultant Litigation

The Company is in dispute with a former consultant (the "Counterparty") regarding whether any remuneration is due for services allegedly provided in Cameroon from 2010 and directed at obtaining various licences and authorisations for the Company. This matter was first disclosed in the Annual Report and Accounts for the year ended 31 December 2016 ("2016 Accounts").

 

In the 2016 Accounts, the Company reported that certain commercial royalties were subject to legal proceedings ("2017 legal proceedings") which were initiated by the Company. The 2017 legal proceedings included a substantial counterclaim advanced against the Company. In 2019, the Company elected to withdraw its 2017 legal proceedings due to the apparent financial weakness of the respondent, as he was unable to pay his share of the deposit requested by the ICC ahead of the arbitral proceedings. Consequently, the counterclaim was not pursued by the Counterparty at that time.

 

In February 2021 the Counterparty initiated an ICC arbitration claim against the Company ("2021 legal proceedings") in respect of the same subject matter and therefore in substantially the same terms as the counterclaim in the 2017 legal proceedings. In defending the 2021 legal proceedings, the Company noted that once again the Counterparty appeared to be unable to pay his share of the deposit on the dates prescribed by the ICC. The Counterparty was therefore at risk that the 2021 legal proceedings would be struck out. The Company notes that payment of the Counterparty's outstanding deposit was made, and the virtual arbitration took place last week. The arbitration ruling is currently expected before the end of the year.

 

Arbitrations under the ICC Rules are subject to data protection and are confidential processes, so VOG is not permitted to provide details or comments on the issues beyond saying that it considers the claim against it in the 2021 legal proceedings to be without merit and that it continues to vigorously defend the claim. The amount under dispute in the arbitration is potentially significant such that an adverse finding could have a material impact upon the position of the Group.

 

Suspension

Owing to the financial uncertainty created by the ICC Award against GDC, the Company's shares were suspended from trading on AIM as announced on 4th April 2022. The suspension of VOG's shares remains in place whilst the Company attempts to finalise a settlement with RSM as noted above. A further announcement will be made later this month to update shareholders.

 

Funding

Until there is resolution with RSM, the Company is unable to raise funds via the equity markets. In addition, given the debt level and material uncertainty with respect to the ICC Award, it is practically impossible for the Company to raise debt financing. The parent company is therefore currently wholly reliant on internally generated funds, the receipt of which vary in quantum and timing. As a result, the financial position of the Company is precarious. The Company remains in regular communication with its creditors, including one of its major shareholders and loan note holders, Hadron Master Fund, whose Loan Note was due for repayment in April 2021 and who remains supportive of the management team's efforts to resolve the financial situation of the Company and has re-confirmed its support as previously announced in May 2022. 

 

For further information, please visit www.victoriaoilandgas.com  or contact: 

 

Victoria Oil & Gas Plc

Roy Kelly/Rob Collins Tel: +44 (0) 20 7921 8820

 

Strand Hanson Limited (NOMAD)

Rory Murphy/James Dance Tel: +44 (0) 20 7409 3494

 

 

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END
 
 
UPDEAPESEEXAFEA
Date   Source Headline
16th Dec 20227:00 amRNSCancellation - Victoria Oil & Gas Plc
27th Oct 20225:30 pmRNSSuspended Companies Notice – Deletions
26th Oct 20227:00 amRNSUpdate on Settlement of The ICC Award to RSM
5th Oct 20229:15 amRNSOperational & Corporate Update
25th Jul 20227:30 amRNSAddendum to ICC Partial Final Award
22nd Jul 20227:00 amRNSQ2 2022 Operational & Corporate Update
30th Jun 20221:45 pmRNSResult of Annual General Meeting
30th Jun 20227:00 amRNSAnnual Report and Accounts & Trading Update
27th Jun 20227:00 amRNSChange of Registered Office
14th Jun 20229:45 amRNSHolding(s) in Company
14th Jun 20229:45 amRNSHolding(s) in Company
31st May 20226:00 pmRNSNotice of AGM
19th May 20227:00 amRNSQ1 2022 Operational & Corporate Update
4th Apr 20227:30 amRNSSuspension - Victoria Oil & Gas plc
4th Apr 20227:00 amRNSTemporary Suspension of Trading
2nd Mar 20227:00 amRNSLoan Note Issue
2nd Feb 20227:00 amRNSQ4 2021 Operational Update
18th Jan 20222:05 pmRNSSecond Price Monitoring Extn
18th Jan 20222:00 pmRNSPrice Monitoring Extension
7th Jan 20222:06 pmRNSSecond Price Monitoring Extn
7th Jan 20222:01 pmRNSPrice Monitoring Extension
7th Jan 202211:06 amRNSSecond Price Monitoring Extn
7th Jan 202211:00 amRNSPrice Monitoring Extension
23rd Dec 20217:00 amRNSMinisterial Approval on Matanda Licence Extension
16th Nov 20214:41 pmRNSSecond Price Monitoring Extn
16th Nov 20214:36 pmRNSPrice Monitoring Extension
16th Nov 20212:05 pmRNSSecond Price Monitoring Extn
16th Nov 20212:00 pmRNSPrice Monitoring Extension
16th Nov 202111:05 amRNSSecond Price Monitoring Extn
16th Nov 202111:00 amRNSPrice Monitoring Extension
16th Nov 20217:00 amRNSUpdate to Logbaba well La-108
1st Nov 20218:42 amRNSReplacement: Interim Results
1st Nov 20217:00 amRNSAnnual Financial Report
1st Oct 202112:00 pmRNSConvertible Loan Note Draw Down
29th Sep 20217:00 amRNSUNCITRAL Arbitration Update
23rd Sep 20212:15 pmRNSInterim Results Extension
10th Sep 20213:22 pmRNSResult of General Meeting
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12th Aug 202112:28 pmRNSResult of General Meeting (“GM”)
4th Aug 20217:00 amRNSQ2 2021 Operational Update
16th Jul 20211:02 pmRNSGrant of Options, Issue of Shares and TVR
16th Jul 20217:00 amRNSNotice of General Meeting to receive Annual Report
13th Jul 20212:06 pmRNSSecond Price Monitoring Extn
13th Jul 20212:00 pmRNSPrice Monitoring Extension
13th Jul 202111:05 amRNSSecond Price Monitoring Extn
13th Jul 202111:00 amRNSPrice Monitoring Extension
13th Jul 20217:00 amRNSAudited Results for the year ended 31 Dec 2020
30th Jun 20211:38 pmRNSResult of Annual General Meeting
30th Jun 20217:20 amRNSAnnual Report and Accounts & Trading update
24th Jun 202111:13 amRNSAnnual General Meeting 2021 Update on Arrangements

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