Xcite Energy Limited ("Xcite Energy" or the "Company") Supply and Offtake Agreement With BP Oil International Limited
28 January 2010 - 6:02PM
Marketwired
Xcite Energy Limited ("Xcite Energy" or the "Company") (TSX-V: XEL)
(LSE: XE)
THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR
DISTRIBUTION IN OR INTO THE UNITED STATES
Xcite Energy, a developer of heavy oil assets in the UK North
Sea, today announces that Xcite Energy Resources Limited ("XER"),
the 100% subsidiary of the Company and the 100% owner of the
Bentley field, has concluded an agreement with BP Oil International
Limited ("BPOI"), a wholly owned subsidiary of BP plc ("BP"),
whereby BPOI will provide the offtake services to market and sell
the Bentley crude oil in return for an incentive-based fee per
barrel.
The offtake fee is directly related to the realised price
achieved by BPOI for the Bentley crude oil in relation to the
prevailing Brent crude price, incentivising BPOI to maximise the
price per barrel achieved for XER by minimising the discount to
Brent crude.
In addition, BPOI have undertaken that, subject to certain
conditions, when Xcite Energy move to full field development, an
associated BP company will procure $20m of financing from a
commercial bank for Xcite Energy with credit support from BP, for
the purpose of assisting with the full field development of the
Bentley field, the terms of which will be negotiated in due
course.
Richard Smith, Xcite Energy Chief Executive Officer
commented:
"We are delighted to welcome BP Oil International as our offtake
partner in the Bentley field. This is a relationship that brings
the global resources and expertise of the BP oil trading
organisation to manage the marketing and selling of the Bentley
crude, together with assistance in financing the work programme as
we move towards first oil on the field. This is another watershed
for the Company, which underpins the value of Bentley crude through
field life and significantly progresses the plan for
development."
Neither 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.
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 December 8, 2009 and in the annual Management's
Discussion and Analysis for Xcite Energy dated March 26, 2009 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
ENQUIRIES: Xcite Energy Limited Richard Smith Chief Executive
Officer Rupert Cole Chief Financial Officer +44 (0) 1330 826740
Strand Hanson Limited (Nomad) James Harris Director Rory Murphy
Director +44 (0) 20 7409 3494 Arbuthnot Securities Limited (Broker)
Andrew Fairclough Director Ed Burbidge +44 (0)20 7012 2000 Pelham
Public Relations Mark Antelme Director +44 (0) 20 7337 1500 Paradox
Public Relations Jean-Francois Meilleur Consultant Karl Mansour
Consultant +1 514 341 0408
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