TIDMCASP
RNS Number : 3123C
Caspian Sunrise plc
12 June 2023
Caspian Sunrise PLC
("Caspian Sunrise", or the "Company")
Sale of 50% of Caspian Explorer & Operational Update
Introduction
The Board of Caspian Sunrise is pleased to update the market
with news of the conditional sale of 50% of the Caspian Explorer
for $22.5 million together with a general operational update.
Background
The Caspian Explorer is a drilling vessel designed specifically
for use in the shallow northern Caspian Sea where traditional deep
water rigs cannot be used.
Caspian Sunrise acquired it for approximately $3.7 million in
2020, since then it has undertaken a safety related contract for
the North Caspian Operating Company .
In March 2023, the Company announced its first drilling
contract, which is scheduled to be drilled in the summer of 2024
with a well to be drilled to a planned depth of 2,500 meters for
the Isatay Operating Company LLP ,a Kazakh registered explorer, in
which Italy's ENI is a leading participant.
Disposal of 50%
The Company has conditionally agreed to sell 50% of the shares
in the UAE registered Prosperity Petroleum FZE, the holding company
of the Kazakh registered KC Caspian Explorer LLP, which in turn
owns the Caspian Explorer drilling vessel, for a cash consideration
of $22.5 million. The purchaser is Stepping Stone Investments
Limited, a company registered in the Seychelles.
The sale is conditional inter alia upon payment being received
by the Company and the re registration of the sale shares in the
UAE.
The carrying value in the Group's 2021 financial statements of
100% of the Caspian Explorer was $3.6 million. The disposal would
therefore be expected to result in a gross accounting profit of
approximately $20 million.
In the year ended 31 December 2022 the Caspian Explorer had no
revenue and costs of approximately $850,000.
The proceeds from the sale would be used in the further
development of the Group's assets.
Operational update
In recent months the focus of the Company's work at its flagship
BNG Contract Area has been at the shallow wells and in particular
Well 142.
Work at Deep Well 802 on the Yelemes Deep structure was
suspended awaiting additional equipment, which due to the sanctions
on Russia, now needs to be sourced via China with much longer lead
times. Accordingly, the crew at Deep Well 802 was moved to work on
Shallow Well 142, historically one of BNG's best performing shallow
wells, at which the Company is drilling a horizontal side
track.
The Company is yet to bring Well 142 back into production but is
now ready to resume work at Deep Well 802 to which the crew has
returned. The Directors estimate it will be up to a further two
months before the Company is able to complete our work at Deep Well
802.
Recent production volumes at BNG have been approximately 2,000
bopd.
As previously reported, the high levels of discount for oil
transported through the Russian pipeline network, even though
Kazakh produced oil is not subject to sanctions, together with tax
still being assessed based on international rather than actual
prices, means the Company is not using the international markets to
sell its oil.
However, the recent fall in the international oil price means
that the net price achieved from sales to mini refineries is now
broadly equivalent to the net price the Company would expect from
international sales without the Urals oil discount.
Preparatory work has begun at Deep Well 803 which is to be
drilled on the Yelemes Deep structure. The Company plans to spud
the well in Q3 and complete it before the end of the year in
accordance with this year's work programme commitments.
Annual General Meeting
This year's AGM will be held on 30 June 2023.
2022 audited financial statements
Work continues in the preparation of the 2022 financial
statements, which are not now expected to be published until
towards the end of June 2023.
Clive Carver, Chairman said
"We are naturally pleased that our faith in the Caspian Explorer
will result in a significant influx of funding to further develop
the Group's assets without any dilution to shareholders."
Caspian Sunrise PLC
Clive Carver, Chairman +7 727 375 0202
WH Ireland, Nominated Adviser & Broker
James Joyce +44 (0) 207 220 1666
James Bavister
Andrew de Andrade
Qualified person
Mr. Assylbek Umbetov, a member Association of Petroleum
Engineers, has reviewed and approved the technical disclosures in
this announcement.
This announcement has been posted to:
www.caspiansunrise.com/investors
The information contained within this announcement is deemed to
constitute inside information as stipulated under the retained EU
law version of the Market Abuse Regulation (EU) No. 596/2014 (the
"UK MAR") which is part of UK law by virtue of the European Union
(Withdrawal) Act 2018. The information is disclosed in accordance
with the Company's obligations under Article 17 of the UK MAR. Upon
the publication of this announcement, this inside information is
now considered to be in the public domain.
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END
DISUPUAWQUPWGQB
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June 12, 2023 02:00 ET (06:00 GMT)
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