HOUSTON, July 26 /PRNewswire-FirstCall/ -- Blue Dolphin
Energy Company (Nasdaq: BDCO, BDCOD ) ("Blue Dolphin" or the
"Company"), an independent oil and gas company with operations in
the Gulf of Mexico, today
announced that it has closed part of its previously announced
transaction with Blue Sky Langsa, Ltd. ("Blue Sky") to acquire a
working interest in a Technical Assistance Contract for the Langsa
area, Offshore Indonesia (the "TAC Langsa") in a non-cash
transaction. Blue Dolphin also announced a core shift in
focus from pipeline gathering to exploration and production and the
resignation of Thomas W. Heath,
President, effective July 1, 2010.
Mr. Heath has agreed to serve as a consultant to the Company
to assist with transition matters.
In June 2010, Blue Dolphin
announced that it had signed a commitment letter with Blue Sky to
acquire a 70% majority working interest in the TAC Langsa. The
parties subsequently amended the terms of the commitment letter in
order to carry out the transaction in two phases. Under the
first phase, Blue Dolphin will acquire a 7% working interest in the
TAC Langsa in exchange for 342,857 shares of Blue Dolphin's common
stock on a post-split adjusted basis. Both parties have
signed the definitive purchase and sale agreement, and Blue Dolphin
has issued the common stock consideration to Blue Sky. Under
the second phase, which is subject to shareholder approval, Blue
Dolphin, at its option, may acquire the remaining 63% working
interest in the TAC Langsa for 3,085,714 shares of Blue Dolphin's
common stock on a post-split adjusted basis.
Blue Dolphin has been working on the strategy shift over the
past year in order to find a more favorable business mix and to
improve operational income. The transformational acquisition of the
Indonesian assets positions Blue Dolphin for future growth, and the
Company will continue to evaluate exploration and production
opportunities, both on and offshore. By breaking the Blue Sky
deal into two parts, Blue Dolphin will realize the impact of cash
flow to operations sooner.
Following acquisition of the TAC Langsa, Blue Dolphin will hold
leasehold interests in Indonesia
and the western Gulf of Mexico
("GOM"). Blue Dolphin's GOM assets are currently held in
Galveston Area Block 321, High Island Block 37 and High Island
Block 115. The TAC Langsa area has net proven reserves of
greater than 1.9 million barrels of oil.
With throughput levels on its pipelines remaining significantly
below capacity, Blue Dolphin is evaluating options to monetize its
pipeline assets. If an attractive alternative is not found,
the pipeline assets may be retained.
Blue Dolphin Energy Company is engaged in the gathering
and transportation of natural gas and condensate and production of
oil and gas in the Gulf of Mexico.
For further information visit the Company's website at
http://www.blue-dolphin.com.
Certain of the statements included in this press release,
which express a belief, expectation or intention, as well as those
regarding future financial performance or results, or which are not
historical facts, are "forward-looking" statements as that term is
defined in the Securities Act of 1933, as amended, and the
Securities Exchange Act of 1934, as amended. The words
"expect", "plan", "believe", "anticipate", "project", "estimate",
and similar expressions are intended to identify forward-looking
statements. These forward-looking statements are not
guarantees of future performance or events and such statements
involve a number of risks, uncertainties and assumptions, including
but not limited to our ability to continue as a going concern;
collectability of a $2.0 million loan
receivable; our ability to regain compliance for continued listing
on NASDAQ; our ability to complete a combination with one or more
target businesses; our ability to improve pipeline utilization
levels; our ability to secure additional working capital to fund
operations; performance of third party operators for properties
where we have an interest; production from oil and gas properties
that we have interests in; volatility of oil and gas prices;
uncertainties in the estimation of proved reserves, in the
projection of future rates of production, the timing of development
expenditures and the amount and timing of property abandonment;
costly changes in environmental and other government regulations
for which Blue Dolphin is subject; and adverse changes in the
global financial markets. Should one or more of these risks
or uncertainties materialize or should the underlying assumptions
prove incorrect, actual results and outcomes may differ materially
from those indicated in the forward-looking statements.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof.
The Company undertakes no obligation to republish revised
forward-looking statements to reflect events or circumstances after
the date hereof or to reflect the occurrence of unanticipated
events.
SOURCE Blue Dolphin Energy Company