Coro Energy PLC Restructured Bulu PSC Acquisition Terms (8998F)
18 July 2019 - 4:00PM
UK Regulatory
TIDMCORO
RNS Number : 8998F
Coro Energy PLC
18 July 2019
18 July 2019
Coro Energy plc
("Coro" or the "Company")
Restructured Bulu PSC Acquisition Terms
Coro Energy plc, the Southeast Asian focused upstream oil and
gas company, announces that it has renegotiated the terms of the
proposed acquisition by the Company of a 42.5% interest in the Bulu
production sharing contract ("PSC"), offshore East Java, which
contains the Lengo gas field (the "Acquisition").
The original terms of the Acquisition were announced by the
Company on 3 September 2018 and the consideration payable by the
Company included a cash consideration of US$ 6.96 million (the
"Cash Consideration") and back costs and other working capital
adjustments estimated to be approximately US$ 1.04 million (the
"Reimbursement Amount"), which were both to be paid by Coro in cash
to AWE Limited ("AWE") on closing of the Acquisition, and up to
US$4 million in new Coro ordinary shares to HyOil (Bulu) Pte. Ltd
(the "Equity Consideration").
Under the revised Acquisition terms, the Cash Consideration and
the Reimbursement Amount payable by the Company to AWE has been
restructured such that it will now be payable in four tranches:
- US$ 2.5 million on completion of the Acquisition
("Completion"), which will include both US$ 1.46 million of the
Cash Consideration plus the Reimbursement Amount;
- US$ 1.5 million on 1 September 2020;
- US$ 2.5 million on the sooner of (i) the Bulu PSC partners
agreeing final investment decision ("FID") to proceed with the
financing, development and construction of the project pursuant to
the approved plan of development; or (ii) 1 July 2021; and
- US$ 1.5 million on the sooner of (i) the date of commencement
of commercial production from the Bulu PSC; or (ii) 31 December
2022.
All other terms of the Acquisition remain as originally
announced including the payment of the Equity Consideration payable
to HyOil in three tranches:
- US$ 2 million on Completion which will be satisfied by the
issue of 42,434,465 new ordinary shares in the Company ("Ordinary
Shares") at an issue price of 3.6255 pence per new Ordinary Share,
being equal to the 30 day volume weighted average price of the
Ordinary Shares at the time of announcement of the Acquisition on 3
September 2018;
- US$ 1 million on signature of a first gas sales agreement
("GSA"), satisfied by the issue of new Ordinary Shares issued at a
price equal to the last closing price of the Ordinary Shares, as
reported by the London Stock Exchange ("LSE"), on the date
immediately following the date of signing the GSA; and
- US$1 million in new Ordinary Shares following the start of
commercial production from the field. These Ordinary Shares to be
issued at the closing price of the Ordinary Shares as reported on
LSE on the date falling five months and three weeks from production
start-up.
Completion of the transaction remains conditional on, inter
alia, JV partner pre-emption and regulatory government approvals
prior to a long stop date of 2 December 2019.
James Menzies, Chief Executive Officer, commented:
"This re-negotiation with the asset vendor extends the
consideration payment schedule out to first commercial gas
production and allows more time for regulatory approvals to be
obtained. This both helps de-risk the investment on Coro's behalf,
whilst also preserving cash in order to build the Company's
portfolio further.
We look forward to both completing the acquisition in due course
and concluding an agreement for the sale of Lengo gas, as the next
significant milestone in taking this project forward."
For further information please contact:
Coro Energy plc Tel: 44 (0)20 3965 7917
James Menzies, Chief Executive Officer
Andrew Dennan, Chief Financial Officer
Cenkos Securities plc (Nominated Adviser) Tel: 44 (0)20 7397 8900
Ben Jeynes
David Jones
Vigo Communications Ltd (IR/PR Advisor) Tel: 44 (0)20 7390 0230
Patrick d'Ancona
Chris McMahon
Mirabaud Securities Ltd (Joint Broker) Tel: 44 (0)20 3167 7221
Peter Krens
Ed Haig-Thomas
Turner Pope Investments (TPI) Ltd Tel: 44 (0)20 3621 4120
(Joint Broker)
Ben Turner
James Pope
The information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
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END
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