31 May 2013 07:00
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION
TSX-V, LSE-AIM: XEL
31 May 2013
Xcite Energy Limited
("Xcite Energy" or the "Company")
Cancellation of Rowan Rig Option
Xcite Energy announces that its 100% subsidiary, Xcite Energy Resources Limited ("XER"), has cancelled its option for a jack-up drilling unit from British American Offshore Limited, a subsidiary of Rowan Companies, Inc. The rig contract was initially entered into in February 2011 and subsequently amended in February 2012 ahead of the pre-production extended well test on the Bentley field, which was completed in September 2012.
Following the extended well test, which has led to the significant increase in reserves and updated field development plan, the Company no longer believes the terms and structure of the rig option to be appropriate for its commercial objectives.
XER has been in constructive dialogue with other drilling rig providers to develop alternative commercial solutions, which potentially would deliver better strategic alignment and fit for purpose structures to reflect the amended Bentley field development programme. Consequently, Expressions of Interest have now been issued to a number of drilling rig providers to formally develop an optimised drilling solution for the Bentley field.
Rupert Cole, CEO of Xcite Energy, commented:
"We are grateful for the provision of the Rowan Norway and the associated drilling support during the successful extended well test last year. The amendments to the Bentley field development plan have given us the opportunity to construct a more commercially attractive and longer term approach to drilling up the field, and we are encouraged by the alternative structures that the industry has to offer. We look forward to updating the market in due course on the outcome of this initiative, which could further enhance the economics of the Bentley field development."
ENQUIRIES:
Xcite Energy Limited |
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+44 (0) 1483 549 063 |
Rupert Cole / Andrew Fairclough |
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Liberum Capital Limited (Joint Broker and Nomad) | +44 (0) 203 100 2000 | |
Clayton Bush / Tim Graham |
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Morgan Stanley (Joint Broker) |
| +44 (0) 207 425 8000 |
Andrew Foster |
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Pelham Bell Pottinger |
| +44 (0) 207 861 3232 |
Mark Antelme / Henry Lerwill |
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Paradox Public Relations |
| +1 514 341 0408 |
Jean-Francois Meilleur |
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Forward-Looking Statements
Certain statements contained in this announcement constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to the Company's future outlook and anticipated events or results and, in some cases, can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "target", "potential", "continue" or other similar expressions concerning matters that are not historical facts. These statements are based on certain factors and assumptions including expected growth, results of operations, performance and business prospects and opportunities. While the Company considers these assumptions to be reasonable based on information currently available to us, they may prove to be incorrect. Forward-looking information is also subject to certain factors, including risks and uncertainties that could cause actual results to differ materially from what we currently expect. These factors include risks associated with the oil and gas industry (including operational risks in exploration and development and uncertainties of estimates oil and gas potential properties), the risk of commodity price and foreign exchange rate fluctuations and the ability of Xcite Energy to secure financing. Additional information identifying risks and uncertainties are contained in the Company's annual information form dated 26 October 2010 and in the Management's Discussion and Analysis for Xcite Energy dated 17 May 2013 filed with the Canadian securities regulatory authorities and available at www.sedar.com. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.