Victoria Oil & Gas PLC US$26m Debt Facility Secured (9906U)
13 April 2016 - 4:00PM
UK Regulatory
TIDMVOG
RNS Number : 9906U
Victoria Oil & Gas PLC
13 April 2016
13 April 2016
Victoria Oil & Gas Plc
("VOG" or "the Company")
US$26m Debt Facility to Support Logbaba Expansion
Victoria Oil & Gas Plc, the integrated natural gas producing
utility, is pleased to announce that its wholly-owned subsidiary
Gaz du Cameroun S.A. ("GDC") has agreed a US$26m debt facility to
support its production expansion at Logbaba through 2016 and 2017.
The facility has been secured with BGFIBank Cameroon S.A.
("BGFIBank"). VOG aims to avoid recourse to equity markets, whilst
ensuring gearing is restricted to appropriate levels as the Company
continues to build value.
During 2016 VOG intends to increase gas production from the
Logbaba Project by 30%, following the 107% increase in average
daily production achieved in calendar year 2015. To meet the
Cameroon market's demand for gas, key elements of GDC's expansion
programme are:
-- Drill 1 twin well and 1 step out well at the Logbaba plant
site with the objective of increasing production reserves
-- Extend the Bonaberi pipeline to customers with gas service agreements in place
-- Increase gas processing plant capacity in three phases to
handle expected increased gas flow from wells
It is the Company's objective to fund the Logbaba development
through operating revenues and capital contributions from GDC and
RSM Production Corporation, our 40% partner. The facility announced
today provides more than sufficient financing for GDC to fund its
share of the production expansion programme.
Debt Facility
GDC has a well-established banking relationship with BGFIBank,
and this new facility extends the existing loan of $4.4m. The debt
facility agreed with BGFIBank by GDC is for a total of XAF 15
billion (approx. US$26 million), with the main material terms
being:
-- Repayment period of five years
-- Facility is available for draw down over a 12 month period
that can be extended without penalty for a further 12 months
-- Interest on the debt is 7.15% per annum
-- Secured by a pledge over certain receivables and a letter of comfort from the Company
-- No further financial covenants
Ahmet Dik, Chief Executive Officer of GDC, said: "This is a very
important step forward for the Company. Once again, BGFIBank is
providing us with flexible debt to help build our business in
Cameroon. We have a highly effective working relationship with
BGFIBank, and we continue to benefit from its high level of
professionalism and capacity to deliver solutions appropriate to
our needs. The 2016-17 production expansion programme for GDC has
been carefully planned and we are committed to delivering increased
levels of gas to customers within budget and without the Company
having recourse to equity markets."
For further information, please visit www.victoriaoilandgas.com
or contact:
Victoria Oil & Gas Plc
Kevin Foo / Laurence Read Tel: +44 (0) 20 7921 8820
Numis Securities
John Prior / Ben Stoop Tel: +44 (0) 20 7260 1000
Strand Hanson Limited
Angela Hallett / Rory Murphy Tel: +44 (0) 20 7409 3494
Bell Pottinger
Daniel Thöle / Charles Stewart / Zara de Belder Tel: +44 (0) 20
3772 2499
Notes to Editors
About Victoria Oil & Gas Plc
Victoria Oil & Gas (VOG.L) is a gas utility company.
The Company's subsidiary, Gaz du Cameroun S.A. ("GDC") owns a
60% participating interest and operates the onshore Logbaba Gas
Project. The Logbaba Gas Project supplies cost effective, clean and
reliable natural gas to industries in the Douala region of
Cameroon. In addition, VOG has recently acquired a 75%
participating interest in the Matanda block, which neighbours the
Logbaba block.
VOG also holds 100% of the West Medvezhye oil and gas
exploration project near Nadym, Russia. Given the challenging
economic environment in Russia, The Group has fully impaired the
West Medvezhye assets.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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