TIDMPTAL
RNS Number : 7909P
PetroTal Corp.
12 June 2020
THIS ANNOUNCEMENT IS RESTRICTED AND IS NOT FOR RELEASE,
PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, JAPAN, NEW
ZEALAND, SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH
RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT
CONSTITUTE: (A) A PROSPECTUS OR OFFERING MEMORANDUM; (B) AN
ADMISSION DOCUMENT PREPARED IN ACCORDANCE WITH THE AIM RULES; OR
(C) AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE
COMPANY. THIS ANNOUNCEMENT DOES NOT CONSTITUTE OR CONTAIN ANY
INVITATION, SOLICITATION, RECOMMATION, OFFER OR ADVICE TO ANY
PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY
SECURITIES OF PETROTAL CORP. IN ANY JURISDICTION IN WHICH ANY SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL.
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY
THE COMPANY TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER
THE MARKET ABUSE REGULATION (REGULATION 596/2014/EU). UPON
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION
SERVICE THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE
PUBLIC DOMAIN.
CAPITALISED TERMS ARE AS DEFINED AT THE OF THIS
ANNOUNCEMENT.
June 12, 2020
PetroTal Corp.
Proposed Placing to raise GBP14.1 million
Calgary and Houston - June 12, 2020-PetroTal Corp. ("PetroTal"
or the "Company") (TSX--V: TAL and AIM: PTAL), the Peruvian focused
E&P company, is pleased to announce a placing of 141.2 million
Placing Units at a price of 10p per unit to raise gross proceeds of
GBP14.1 million (approximately US$18 million). Each Placing Unit
will be comprised of one new Common Share and one half of one
Warrant.
Placing highlights
-- The Placing was significantly oversubscribed.
-- The Company intends to use the net proceeds of the Placing
for ongoing development of the Bretana oilfield and to enhance
working capital. In particular, the net proceeds will be deployed
by the Company in connection with the proposed reopening of the
Bretana oilfield which is anticipated to occur in July.
-- With a stronger balance sheet, PetroTal will be able to
finalize a credit facility for day-to-day operations and structure
derivatives to minimize the impact of future oil price
fluctuations.
-- Auctus Advisors is acting as sole bookrunner on the Placing.
Strand Hanson is acting as Nominated and Financial Adviser to the
Company.
Background to and reasons for the Placing
As recently announced, PetroTal has entered into a financial
arrangement with PETROPERU S.A. ("Petroperu") relating to the
contingent liability due to Petroperu which will see the entire
contingent liability resolved on a one-time basis and see the
obligation paid evenly over a three year period, at an annual
interest rate of 6.5%.
Meanwhile, however, the Bretana oil field remains shut down
awaiting opening of the Northern Oil Pipeline ("ONP") by Petroperu.
PetroTal is coordinating with Petroperu to reopen the Bretana oil
field in July 2020, with the expectation that the ONP restarts
pumping oil very shortly thereafter. Both PetroTal and Petroperu
will fully abide by the health directives issued by the Peruvian
government in order to safely restart operations during the ongoing
Covid-19 pandemic.
In this period of uncertainty in the context of the Covid-19
pandemic, the Directors consider that strengthening its balance
sheet with additional working capital is a prudent action.
Details of the Placing
The Company will raise gross proceeds of GBP14.1 million
pursuant to the Placing. The Placing will result in the issue of a
total of 141,203,891 new Common Shares and 70,601,945 Warrants. The
Placing Shares will represent approximately 17.3 per cent. of the
Enlarged Share Capital.
The Placing Price represents a discount of approximately 11 per
cent. to the closing mid-market price per existing Common Share of
11.25 pence on June 11, 2020, being the last practicable trading
day prior to release of this announcement.
The Placing Shares will, when issued, be subject to the Articles
and By Laws, be credited as fully paid and non-assessable and rank
equally in all respects with each other and with the Existing
Common Shares, including the right to receive all dividends and
other distributions declared, made or paid in respect of the Common
Shares after the date of issue of the Placing Shares.
Warrants
Each Placing Unit will comprise one Placing Share and one half
of one Warrant.
A whole Warrant (comprised of two half Warrants) will have an
exercise price of 16p per Common Share, which equates to a 60%
premium above the Placing Price, and will be capable of being
exercised at any time from and after the date of Admission until
the third anniversary of Admission. The Warrants can only be
exercised for cash.
The Warrant exercise price and the number of shares issuable
upon exercise of the Warrants will be adjusted in certain
circumstances, including if the Company effects a subdivision or
consolidation of its Common Shares, declares a dividend or
distribution, or there is a reorganisation of its Common
Shares.
Related Party Transaction
As at June 11, 2020, Meridian Capital International Fund
("Meridian") held approximately 11.8 per cent. of the Existing
Share Capital and, as such, is considered to be a related party of
the Company as defined by the AIM Rules.
Meridian is participating in the Placing for an amount of GBP7.5
million and this participation constitutes a related party
transaction pursuant to AIM Rule 13 and Multilateral Instrument
61-101 Protection of Minority Security Holders in Special
Transactions ("MI 61-101"). Following completion of the Placing,
Meridian and its linked parties will hold 19.42 per cent. of the
Enlarged Share Capital.
The Directors, other than Mr. Gavin Wilson, who represents
Meridian on the Board, having consulted with the Company's
nominated adviser, Strand Hanson Limited, consider that the terms
of the participation by Meridian are fair and reasonable insofar as
the shareholders of the Company are concerned. In its consideration
and approval of the Placing, the Directors determined that it was
exempt from the formal valuation and minority approval requirements
of MI 61-101 on the basis that the fair market value of the Placing
to Meridian did not exceed 25% of the market capitalization of
PetroTal, in accordance with Sections 5.5 and 5.7 of MI 61-101.
The terms of the Warrants issued to Meridian will provide that,
subject to certain exceptions, Meridian shall not exercise any
Warrants where such exercise would result in Merdian's beneficial
ownership, direction or control of the issued and outstanding
Common Shares at the time of exercise exceeding 19.99%.
Placing Agreement
The Company and Auctus have entered into the Placing Agreement
pursuant to which (a) the Company has appointed Auctus as the
Company's agent to use its reasonable endeavours to procure
subscribers for the Placing Units at the Placing Price. The Placing
is not underwritten. The Company has agreed to pay Auctus certain
commissions in connection with the Placing.
The Placing is conditional on, amongst other things, Admission
of the Placing Shares occurring on or before 8.00 a.m. on June 18,
2020 (or such later time and/or date as the Company and Auctus may
agree, being not later than 8.00 a.m. on June 26, 2020).
The Placing Agreement contains certain customary warranties
given by the Company concerning the accuracy of the information in
this Announcement as well as other matters relating to the Group
and its business. The Placing Agreement is terminable by Auctus in
certain circumstances prior to Admission, including for force
majeure or in the event of a material adverse change to the
business of the Company or the Group. The Company has also agreed
to provide a market standard indemnity and undertakings to
Auctus.
Admission
Application will be made to: (a) the London Stock Exchange for
Admission of the Placing Shares to trading on AIM; and (b) the TSXV
for listing of the Placing Shares for trading on the facilities of
the TSXV.
It is expected that Admission will become effective at 8.00 a.m.
on June 18, 2020 (or such later date as the Company and Auctus may
agree, being not later than 8.00 a.m. on June 26, 2020) and that
dealings in the Placing Shares will also commence at that time.
The Warrants will not be admitted to trading on AIM or listed
for trading on the facilities of the TSXV.
Without prior written approval of the TSXV and compliance with
all applicable Canadian securities laws, the Placing Shares,
Warrants and Common Shares issuable on the exercise of Warrants may
not be sold, transferred, hypothecated or otherwise traded on or
through the facilities of TSXV or otherwise in Canada or to or for
the benefit of a Canadian resident until the date that is four
months and a day after the date of issuance.
The relevant clearances have not been, nor will they be,
obtained from the securities commission of any province or
territory of Canada; no prospectus has been lodged with or
registered by, the Australian Securities and Investments Commission
or the Japanese Ministry of Finance; and the Placing Shares and
Warrants have not been, nor will they be, registered or qualified
for distribution, as applicable under or offered in compliance with
the securities laws of any state, province or territory of United
States, Australia, New Zealand, Canada, Japan or South Africa.
Accordingly, the Placing Units may not (unless an exemption under
the relevant securities laws is applicable) be offered, sold,
resold or delivered, directly or indirectly, in or into the United
States, Australia, New Zealand, Canada, Japan or South Africa or
any other jurisdiction outside the United Kingdom.
Manolo Zuniga, President and Chief Executive Officer,
commented:
"In light of the recent fall in global oil prices and the
temporary shut in of the Bretana oil field, we have sought to
preserve liquidity and are taking the opportunity to strengthen the
Company's balance sheet via this fundraise.
The Placing and the arrangement announced with Petroperu today
will give PetroTal greater financial strength and sufficient
flexibility to prepare for the reopening of the Bretana field,
which is expected to occur in July. Additionally, the Petroperu
arrangement and support by the Peruvian government, demonstrates
that Peru provides an excellent investment climate.
I would like to thank our investors for their continued support,
as seen with the Placing being oversubscribed, and I look forward
to keeping the market appraised on developments at Bretana over the
coming months."
ABOUT PETROTAL
PetroTal is a publicly -- traded, dual -- quoted (TSXV: TAL and
AIM: PTAL) oil and gas development and production company domiciled
in Calgary, Alberta, focused on the development of oil assets in
Peru. PetroTal's flagship asset is its 100% working interest in
Bretaña oil field in Peru's Block 95 where oil production was
initiated in June 2018, and in early 2020 became the second largest
oil producer in Peru. Additionally, the Company has large
exploration prospects and is engaged in finding a partner to drill
the Osheki prospect in Block 107. The Company's management team has
significant experience in developing and exploring for oil in
Northern Peru and is led by a Board of Directors that is focused on
safely and cost effectively developing the Bretaña oil field.
For further information, please see the Company's website at
www.petrotal-corp.com, the Company's filed documents at
www.sedar.com, or contact:
Douglas Urch
Executive Vice President and Chief Financial Officer
Durch@PetroTal-Corp.com
T: (713) 609-9101
Manolo Zuniga
President and Chief Executive Officer
Mzuniga@PetroTal-Corp.com
T: (713) 609-9101
Auctus Advisors LLP (Sole Bookrunner to the Placing)
Jonathan Wright / Rupert Holdsworth Hunt / Harry Baker
Tel: +44 (0) 7711 627449
Celicourt Communications
Mark Antelme / Jimmy Lea
petrotal@celicourt.uk
T: 44 (0) 208 434 2643
Strand Hanson Limited (Nominated & Financial Adviser)
James Spinney / Ritchie Balmer / Rory Murphy
T: 44 (0) 207 409 3494
Stifel Nicolaus Europe Limited (Joint Broker)
Callum Stewart / Simon Mensley / Ashton Clanfield
Tel: +44 (0) 20 7710 7600
Numis Securities Limited (Joint Broker)
John Prior / Emily Morris
T: +44 (0) 207 260 1000
FURTHER INFORMATION
DEFINITIONS
The following definitions apply throughout this Announcement
unless the context otherwise requires:
Admission the admission of the Placing Shares
to trading on AIM becoming effective
in accordance with Rule 6 of the
AIM Rules
AIM the market of that name operated
by the London Stock Exchange
-----------------------------------------
AIM Rules the AIM Rules for Companies published
by the London Stock Exchange as they
may be amended and replaced from
time to time
-----------------------------------------
Articles the articles of amalgamation of the
Company (as amended from time to
time)
-----------------------------------------
Auctus or Auctus Advisors Auctus Advisors LLP, sole bookrunner
to the Placing
-----------------------------------------
By Laws the by-laws of the Company adopted
on December 18, 2017 (as amended
from time to time)
-----------------------------------------
Common Shares common shares in the capital of the
Company
-----------------------------------------
Company or PetroTal PetroTal Corp., a public company
incorporated under the laws of Alberta
with corporate access number 2020869455
and whose registered office is at
c/o Stikeman Elliott LLP Suite 4300,
888 3rd Street S.W., Calgary Alberta
T2P 5C5
-----------------------------------------
Directors the directors of the Company
-----------------------------------------
Enlarged Share Capital together, the Existing Common Shares
and the Placing Shares
-----------------------------------------
Existing Common Shares the 673,351,810 Common Shares in
issue at the date of this Announcement
-----------------------------------------
London Stock Exchange London Stock Exchange plc
-----------------------------------------
Meridian Meridian Capital International Fund
-----------------------------------------
Petroperu PETROPERU S.A.
-----------------------------------------
Placees those persons who subscribe for Placing
Shares and/or acquire Sale Shares
pursuant to the Placing
-----------------------------------------
Placing the placing of the Placing Units
at the Placing Price by Auctus as
agent for and on behalf of the Company
pursuant to the terms and conditions
of the Placing Agreement
-----------------------------------------
Placing Price 10 pence per Placing Unit
-----------------------------------------
Placing Agreement the conditional placing agreement
dated June 12, 2020 relating to the
Placing and entered into between
the Company and Auctus
-----------------------------------------
Placing Shares the 141,203,891 new Common Shares
to be issued to Placees pursuant
to the Placing
-----------------------------------------
Placing Unit One Placing Share and one half of
one Placing Warrant to be subscribed
for as a unit by the Placees at the
Placing Price
-----------------------------------------
Strand Hanson Strand Hanson Limited, the Company's
Nominated and Financial Adviser
-----------------------------------------
TSXV TSX Venture Exchange
-----------------------------------------
United States or US the United States of America, its
territories and possessions, any
state of the United States and the
District of Columbia and all other
areas subject to its jurisdiction
-----------------------------------------
GBP or Sterling pounds sterling, the basic currency
of the United Kingdom
-----------------------------------------
US$ United States dollar, the legal currency
of the United States
-----------------------------------------
Warrants warrants to subscribe for new Common
Shares
-----------------------------------------
READER ADVISORIES
FORWARD -- LOOKING STATEMENTS: This press release contains
certain statements that may be deemed to be forward -- looking
statements. Such statements relate to possible future events,
including, but not limited to: PetroTal's business strategy,
objectives, strength and focus; the Company's ability to resume
operations in accordance with developing public health efforts to
contain COVID-19; the financial arrangement with Petroperu relating
to certain contingent liabilities; and the Placing, including with
respect to size, timing and use of proceeds. All statements other
than statements of historical fact may be forward -- looking
statements. Forward -- looking statements are often, but not
always, identified by the use of words such as "anticipate",
"believe", "expect", "plan", "estimate", "potential", "will",
"should", "continue", "may", "objective" and similar expressions.
The forward -- looking statements are based on certain key
expectations and assumptions made by the Company. Although the
Company believes that the expectations and assumptions on which the
forward -- looking statements are based are reasonable, undue
reliance should not be placed on the forward -- looking statements
because the Company can give no assurance that they will prove to
be correct. Since forward -- looking statements address future
events and conditions, by their very nature they involve inherent
risks and uncertainties. Actual results could
differ materially from those currently anticipated due to a
number of factors and risks. These include, but are not limited to,
risks associated with the oil and gas industry in general (e.g.,
operational risks in development, exploration and production;
delays or changes in plans with respect to exploration or
development projects or capital expenditures; the uncertainty of
reserve estimates; the uncertainty of estimates and projections
relating to production, costs and expenses; and health, safety and
environmental risks), commodity price volatility, price
differentials and the actual prices received for products, exchange
rate fluctuations, legal, political and economic instability in
Peru, access to transportation routes and markets for the Company's
production, changes in legislation affecting the oil and gas
industry and uncertainties resulting from potential delays or
changes in plans with respect to exploration or development
projects or capital expenditures. In addition, the Company cautions
that current global uncertainty with respect to the spread of the
COVID-19 virus and its effect on the broader global economy may
have a significant negative effect on the Company. While the
precise impact of the COVID-19 virus on the Company remains
unknown, rapid spread of the COVID-19 virus may continue to have a
material adverse effect on global economic activity, and may
continue to result in volatility and disruption to global supply
chains, operations, mobility of people and the financial markets,
which could affect interest rates, credit ratings, credit risk,
inflation, business, financial conditions, results of operations
and other factors relevant to the Company. Please refer to the risk
factors identified in the Company's annual information form for the
year ended December 31, 2018 and management's discussion and
analysis for the nine months ended September 30, 2019 which are
available on SEDAR at www.sedar.com. The forward -- looking
statements contained in this press release are made as of the date
hereof and the Company undertakes no obligation to update publicly
or revise any forward -- looking statements or information, whether
as a result of new information, future events or otherwise, unless
so required by applicable securities laws.
FOFI DISCLOSURE: This press release contains future -- oriented
financial information and financial outlook information
(collectively, "FOFI") about PetroTal's temporary shut down of
operations, adequacy of financial resources during the shut down,
the anticipated resumption of operations, the settlement of the
contingent liability with Petroperu, working capital, balance sheet
strength, the Placing and components thereof, all of which are
subject to the same assumptions, risk factors, limitations and
qualifications as set forth in the above paragraphs. FOFI contained
in this press release was approved by management as of the date of
this press release and was included for the purpose of providing
further information about PetroTal's anticipated future business
operations. PetroTal disclaims any intention or obligation to
update or revise any FOFI contained in this press release, whether
as a result of new information, future events or otherwise, unless
required pursuant to applicable law. Readers are cautioned that the
FOFI contained in this press release should not be used for
purposes other than for which it is disclosed herein.
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 press release.
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
IOESFFSIEESSELM
(END) Dow Jones Newswires
June 12, 2020 02:05 ET (06:05 GMT)
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