TIDMLOGP
RNS Number : 1524B
Lansdowne Oil & Gas plc
05 June 2019
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). Upon the
publication of this announcement via Regulatory Information Service
("RIS"), this inside information is now considered to be in the
public domain. If you have any queries on this, then please contact
Steve Boldy, the Chief Executive Officer of the Company
(responsible for arranging release of this announcement).
Lansdowne Oil & Gas plc
("Lansdowne" or the "Company")
Standard Exploration Licence 1/11
Barryroe, North Celtic Sea Basin
Operational Update
5 June 2019
Lansdowne Oil & Gas plc (AIM: LOGP), the North Celtic Sea
focused, oil and gas company, notes the announcement today by
Providence Resources P.l.c. regarding Barryroe, which reads as
follows:
Update on Barryroe Farm-Out Transaction
Dublin and London - June 5, 2019 - Providence Resources P.l.c.
(PVR LN, PRP ID), the Irish based Energy Company ("Providence" or
the "Company"), today provides a commercial and operational update
in relation to Standard Exploration Licence ("SEL") 1/11 which
contains the Barryroe oil accumulation (the "Barryroe Project").
SEL 1/11 is operated by EXOLA DAC ("EXOLA" or the "Operator", 40%),
a wholly-owned Providence subsidiary, on behalf of its partners,
APEC Energy Enterprises Limited ("APEC") and Lansdowne Celtic Sea
Limited ("Lansdowne", 10%). The area lies in c. 100 metre water
depth in the North Celtic Sea Basin and is located c. 50 km off the
south coast of Ireland.
Barryroe Farm-Out - Commercial Update
On September 20, 2018, the Company announced the signing of an
amended and restated Farm-Out Agreement (the "Updated FOA") for the
Barryroe Project with APEC Energy Enterprises Limited ("APEC") and,
together with EXOLA and Lansdowne (the "Barryroe Partners").
Amendments to Updated FOA
Since the signing of the Updated FOA, the Barryroe Partners have
agreed additional amendments to the agreement - a total of US$24
million (previously US$19.5 million) has now been allocated to fund
the forward costs of EXOLA as Operator of the Barryroe Project.
Such costs are associated with carrying out the well-site survey
operations, consenting the drilling programme and other
project-related costs. This increased sum reflects an agreed
augmented scope of Operator-related costs associated with the
drilling programme.
Of the US$24 million, US$9 million is to specifically cover the
costs associated with front-end well-site survey operations and
pre-drill well consenting, which have not been incurred yet due to
the previously disclosed legal challenge to the well-site survey
consent. The balance of US$15 million is payable prior to the
spudding of the first well and is to cover Operator-related
drilling costs.
Such costs are to be financed by APEC pursuant to a non-recourse
loan facility (the "Loan") which, as announced previously, is
drawable against the budget for the Drilling Programme, will incur
an annual interest rate of LIBOR +5% and will be repayable from
production cashflow from SEL 1/11 with APEC being entitled to 80%
of production cashflow from SEL 1/11 until the Loan is repaid in
full.
Following repayment of the Loan, APEC will be entitled to 50% of
production cashflow from SEL 1/11 with EXOLA and Lansdowne being
entitled to 40% and 10% of production cashflow, respectively.
Delay in Receipt of US$9 Million Loan Advance from APEC
Pursuant to the original terms of the Updated FOA, which
envisaged well-site survey operations during Q4 2018, it was agreed
that APEC would proceed to make an advance under the Loan of an
initial US$9 million shortly after the signing of the Updated FOA.
This advance was not received during Q4 2018 as originally
expected. However, given the delays to the programme (see below),
the Operator did not, in fact, require the funds at that time to
finance the front-end well-site survey operations and pre-drill
well consenting.
The Barryroe Partners have agreed a series of amendments to the
Updated FOA over recent months which provided for extensions to the
date by APEC of the initial loan advance US$9 million, with the
last extension being set at May 31, 2019. At the time of this RNS,
this US$9 million loan advance has yet to be received by the
Company and, following further discussions with APEC, the Barryroe
Partners have agreed a revised backstop date for receipt of the
loan advance of June 14, 2019. The Company understands that this
delay is due, in part, to a change in the composition of APEC's
funding mechanism. The Company will issue a further update in due
course.
Barryroe Farm-Out - Site-Survey Update
On November 30, 2018, due to an application for a judicial
review by An Taisce (taken against the Irish Minister of
Communications, Climate Action and Environment ("DCCAE") and the
Attorney General), challenging the legality of the permission
granted to EXOLA to conduct the well-site survey operations, the
Barryroe Partners advised the DCCAE that they would not act on the
well site-survey permission granted and would apply for a new
consent.
In February 2019, a new application for consent to carry out
well-site survey operations was submitted to the Irish regulatory
authorities who have engaged new third-party environmental
consultants. This new application supersedes the previous well-site
survey operations consent granted to EXOLA in October 2018. A
number of questions were subsequently raised by the regulator and
replies to all of these were supplied by EXOLA and the application
is currently the subject of adjudication by the regulatory
authorities.
Subject to receipt of regulatory consents and financing, the
well-site survey operations are now expected to be carried out in
Q3 2019 (previous estimate was Q2 2019).
Barryroe Farm-Out - Drilling Timeline Update
Given the delays associated with the legal challenge to the
well-site survey consent, and the impact that this has had on the
subsequent planning and pre-drill consenting operations, the
Barryroe Partners now expect that drilling operations at Barryroe
to commence in Q4 2019 (previous estimate was Q3 2019), subject to
financing and the receipt of all consents.
Announcement & Forward-Looking Statements
This announcement contains certain forward-looking statements.
Actual results may differ materially from those projected or
implied in such forward-looking statements. Such forward-looking
information involves risks and uncertainties that could
significantly affect expected results. No representation is made
that any of those statements or forecasts will come to pass or that
any forecast results will be achieved. You are cautioned not to
place any reliance on such statements or forecasts. Those
forward-looking and other statements speak only as at the date of
this announcement. Providence Resources P.l.c undertakes no
obligation to update any forward-looking statements.
This announcement has been reviewed by Dr John O'Sullivan,
Technical Director, Providence Resources P.l.c. John is a geology
graduate of University College, Cork and holds a Masters in Applied
Geophysics from the National University of Ireland, Galway. He also
holds a Masters in Technology Management from the Smurfit Graduate
School of Business at University College Dublin and a doctorate in
Geology from Trinity College Dublin. John is a Chartered Geologist
and a Fellow of the Geological Society of London. He is also a
member of the Petroleum Exploration Society of Great Britain, the
Society of Petroleum Engineers and the Geophysical Association of
Ireland. John has more than 25 years of experience in the oil and
gas exploration and production industry having previously worked
with both Mobil and Marathon Oil. John is a qualified person as
defined in the guidance note for Mining Oil & Gas Companies,
March 2006 of the London Stock Exchange. Definitions in this press
release are consistent with SPE guidelines. SPE/WPC/AAPG/SPEE
Petroleum Resource Management System 2007 has been used in
preparing this announcement.
For further information please contact:
Lansdowne Oil & Gas plc +353 1 963 1760
Steve Boldy
SP Angel Corporate Finance LLP +44 (0) 20 3470 0470
Nominated Adviser
Lindsay Mair
Richard Hail
Brandon Hill Capital +44 (0) 20 3463 5061
Broker
Oliver Stansfield
Notes to editors:
About Lansdowne
Lansdowne Oil & Gas (LOGP.LN) is a North Celtic Sea focused,
oil and gas exploration and appraisal company quoted on the AIM
market and head quartered in Dublin.
For more information on Lansdowne, please refer to
www.lansdowneoilandgas.com
About Providence Resources
Providence Resources is an Irish based Oil & Gas Exploration
Company with a portfolio of appraisal and exploration assets
located offshore Ireland. Providence's shares are quoted on the AIM
in London and the Euronext Growth Market in Dublin. Further
information on Providence can be found on
www.providenceresources.com
About APEC
APEC Energy Enterprise Ltd. was established in 2014 as a Hong
Kong registered company with headquarters in Beijing. In addition
to its original focus on offshore oil & gas services, APEC
provides upstream energy acquisition advice and management services
in partnership with Chinese Oil Companies, offshore and onshore
service providers, and SOE investment groups.
www.apecenergy.com.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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