RNS Number:0283S
Indago Petroleum Limited
10 April 2008
INDAGO PETROLEUM LIMITED
(The "Company" or "Indago")
Preliminary results for the year ended 31 December 2007
Indago Petroleum Limited ("Indago" or "the Company"), the oil and gas
exploration company focused on the Middle East with assets in the Sultanate of
Oman today announces its preliminary results for the year ended 31 December
2007.
Highlights
Financial
* Profit for the year $294 million due to sale of assets to RAK
Petroleum
* Earnings per share (basic) $5.51
* Special dividend paid $318 million
* Cash at year end $41 million - sufficient to complete firm drilling
programme
Operational
* Al Jariya-1 well on Jebel Hafit prospect, Block 31 Oman, spudded early
2007
* Safely drilled Al Jariya-1 to 5,131 metres by early February 2008 when
well encountered HP/HT water 50 metres above estimated depth of
reservoir
* Remedial work will require at least a sidetrack at around 4,300
metres
* Prospectivity of Jebel Hafit substantially intact, targeting 1,040
Bcf gas and 157 MMB of condensate (Indago share)
* Remedial costs may be wholly or partly borne by insurance
* Probable move of rig to Zad on Block 47 Oman whilst Al Jariya special
equipment sourced.
* Zad targeting 222 Bcf gas and 34.5 MMB condensate (Indago share)
* Estimated spud of Zad: May 08 and return to Al Jariya: Q4 08
* Delay to overall programme approximately 4 months
Organisational
* Management, technical and commercial capabilities re-established
post RAK Petroleum sale
* David Bremner, former non-executive director, appointed CEO
Outlook
* Exploration focused business
* Results of Al Jariya -1 and Zad wells expected during 2008
* Entered new 3 year exploration term on Block 47, Oman
* Full evaluation of additional onshore Oman opportunities in progress
* Focus on completing Oman programme and seeking new ventures and
corporate opportunities
Tim Eggar, Chairman of Indago commented:
"After the buoyant mood created by the deal with RAK Petroleum, the Company and
its partner have been focused on the enormous efforts needed to drill the Al
Jariya-1 well on the Jebel Hafit prospect. This has proved to be an
exceptionally challenging project which has required large measures of technical
skill, ingenuity and, above all, patience and perseverance.
Despite the current delays to completion, the important message is that Indago
still has a significant upside in its firm drilling programme and the funding to
see it through to its conclusion."
Indago Petroleum Limited
Tim Eggar, Chairman +44 7771 597 499
David Bremner CEO + 1 805 708 4892
Martin Groak, CFO +44 20 7096 3461
JPMorgan Cazenove (corporate broker) +44 20 7588 2828
Barry Weir
Neil Haycock
Nabarro Wells (NOMAD) +44 20 7634 4858
Marc Cramsie
College Hill Associates +44 20 7457 2020
Paddy Blewer
Nick Elwes
These materials contain forward-looking statements regarding Indago, its
corporate plans, future financial condition, future results of operations and
future business plans and strategies. All such forward-looking statements are
based upon Indago management's knowledge, assumptions and beliefs in the light
of information available to them at the time these statements were issued. These
forward-looking statements are, by their nature, subject to significant risks
and uncertainties and actual results, performance and achievements may be
materially different from those expressed in such statements.
CHAIRMAN'S STATEMENT
Dear Shareholder,
Financially, 2007 was an outstanding year. After-tax profits were in excess of
$290 million and we were able to pay an interim special dividend of $318
million, equal to 60 pence per old share, whilst retaining sufficient cash to
take us through the current drilling programme and beyond. I reported fully last
year on the agreement with RAK Petroleum PCL for the sale of our production,
development and half our exploration assets and so will not be going into detail
again here. Suffice it to say, we were one of a relatively small number of AIM
companies in our sector to pay a cash dividend to its shareholders in 2007.
Operationally, the year was one of frustrations. When I reported to you in
September last year, we had been experiencing a number of technical difficulties
with the Al Jariya well on the Jebel Hafit prospect in the Sultanate of Oman,
but reasonable progress had been resumed and we were looking towards the early
part of this year for first indications of the value of the prospect.
At the beginning of February, however, the drilling operation penetrated a
horizon from which salt water emerged at very high temperatures and pressures.
The problem was very professionally managed by the Operator and the well brought
under control immediately, but the impact on the Jebel Hafit project has been
profound. It appears likely that we will need to substantially redrill the
section of the well below 4,300 meters. This will require some specialised
equipment which is not immediately available and, to avoid an expensive stand-by
period we anticipate moving the rig to drill our Zad well in Block 47, Oman
before moving back to complete the Al Jariya well later in the year. Our
analysis of all of the geological and engineering data from the Al Jariya well
suggests that the prospectivity of the Jebel Hafit prospect remains
substantially undiminished, certainly at the Shuaiba level where 80% of the
pre-drill reserves are located.
Our task now is to reshape the strategy of the business going forward. The
immediate focus remains onshore Oman where we have several leads and prospects
that we continue to evaluate. However, the upstream oil and gas industry is, as
ever, in a state of flux and the next year or so is widely predicted to be
particularly active for corporate and asset transactions involving the small
company sector. We will be on the lookout for suitable opportunities.
One sadness of the RAK transaction was that Indago lost the services of Peter
Sadler, John Hurst and almost all the team that had built Indago's original
portfolio. Their contribution had been invaluable.
I would like to thank our CFO, Martin Groak, who filled in as acting CEO after
the RAK transaction until November of last year when David Bremner moved over
from his non-executive role to become our new CEO. With a strong team, assisted
by consultants and advisers, we look forward to completing our budgeted
programme in Oman, maturing additional prospects in our existing Blocks and,
potentially, pursuing new initiatives during the coming year.
Tim Eggar
Chairman
Indago Petroleum Limited
CHIEF EXECUTIVE'S REPORT
COMPANY HIGHLIGHTS
Financial Highlights
Profit for the year $294 million
The disposal of the Group's production and development assets, its cash and half
of its exploration assets to RAK Petroleum PCL (RAK Petroleum) grossed $383
million and produced a profit on disposal of $306 million. This was the main
contributor to the Group's net profit of $294 million.
(The results of 2007 cannot readily be compared with those of 2006 (a loss of
$3.8 million), which were based on revenues of gas condensate and from which the
Group only benefited in the first quarter of 2007.)
Interim special dividend : $318 million
The Company paid an interim special dividend of 60 pence per share, prior to the
1 for 5 share consolidation. This would have been the equivalent of �3 per share
based on the number of shares in issue now. The repayment of this cash to
investors substantially de-risked their investment, whilst leaving them exposed
to the upside potential of the rest of the portfolio.
To achieve this, the Company's share premium account was cancelled in order to
generate sufficient distributable reserves.
The Board is not recommending a final dividend.
Cash and cash equivalents : $41 million
The Group had cash assets of over $41 million at the year end, more than
sufficient to fund its share of the firm drilling programme.
Exploration
Following last year's disposal of assets, the Group is for the time being a pure
exploration entity with non-operated interests in three joint ventures with RAK
Petroleum exploring Blocks 31, 43A and 47 onshore the Sultanate of Oman. The
operator of all three blocks is RAK Petroleum.
Hawamel
Hawamel, on the Izz prospect in Block 47, was drilled at the end of 2006 and,
following rather inconclusive results, decisions on next steps there have been
deferred. The porosity and permeability of the Cretaceous carbonate reservoirs
were poor, although gas was inferred and one portion of the reservoir did show
some promise in terms of possible gas saturation. Possible courses of action
include drilling an underbalanced, horizontal leg from the existing wellbore
through the encountered formations. Interestingly, this approach was used
recently in an adjacent block with an acceptable degree of success.
The cost implications have been assessed and although initial indications were
that it would be at a similar cost to a conventional testing programme, the
results of the tendering process would suggest something considerably higher. At
the moment it is not a priority for the joint venture. The next well in the
programme, after Al Jariya-1, is the Zad well on the Adam prospect, also in
Block 47. A success at Adam could enhance the potential value of Izz.
Al Jariya
Most of 2007 was taken up with the drilling at Jebel Hafit. In January 2007, we
spudded the Al Jariya-1 well, to be drilled to a depth of approximately 5,900
metres. Significant geological and mechanical challenges were encountered at
virtually every stage, including requiring two sidetracks at relatively shallow
depth. After a year of drilling, the operation had reached 5,100 metres. Just
beyond this depth, a strong flow of high-temperature, high-pressure salt water
with high levels of carbon dioxide and some gas was encountered. The well was
always considered to be a potentially difficult, very high pressure, high
temperature project and with this in mind we had a highly experienced well
control team at the wellsite as the well was drilled deeper. When the well
control incident occurred on February 2nd of this year, this team was able to
react immediately and ensure the incident did not get out of hand.
At the time of writing the Operator is continuing attempts to rehabilitate the
well and it looks as though the way forward will be to abandon and cement the
open hole section of the well with cement extending up inside the casing to
about 4,300 meters. A window will then be cut in the casing at about that depth
and the well will be sidetracked and, hopefully, the two reservoir objectives
penetrated in the new hole. Discussions are continuing but it appears likely
that at least a significant portion of the cost of the well control and
remediation will be covered by the joint venture's well control insurance.
One source of disappointment is that the sidetrack and substantial redrill of
the lower portion of the well will require specialised equipment which is not
readily available The likely outcome of this is that the most prudent course of
action will be to suspend the Al Jariya well after cementing back and moving the
Nabors 103 rig off Jebel Hafit and on to the Zad well on the Adam Prospect. All
being well we would hope to be spudding Zad during May and be back on Al Jariya
during the 4th quarter 2008.
Zad
The Zad well on the Adam prospect in Block 47 is geologically very different to
(and potentially much larger than) the nearby Izz prospect, where we were
targetting Cretaceous age carbonates with mainly dry gas, at a depth of 1,900
metres. Zad is targeting Cambrian age sandstones, mainly gas and gas
condensate, at a depth of 4,200 metres.
As discussed above, the current expectation is that Zad will spud towards the
summer of 2008 and is forecast to take some 90 days to reach total depth. It is
a more straightforward drilling proposition than at Jebel Hafit and we would
certainly hope for a more routine operation.
The drilling of Zad and the subequent conclusion of the Al Jariya well will
complete the current firm drilling programme.
Outlook
The seismic work being done over the three exploration blocks is nearing its
conclusion and there are significant leads to be analysed further. New 2D
seismic acquired during late 2006 and early 2007 has allowed us to define better
the Dham, Sadood and Kabshat leads and prospects in Block 47, the Jebel Wa'bah
prospect in Block 31 and the Kahal structure in Block 43A.
Meanwhile, we are evaluating a number of new opportunities for joint ventures in
the general area of the Middle East, North Africa and the Caspian. We hope to
expand the Company's exploration portfolio by bringing one or two of these
opportunities to fruition over the next few months.
We are very aware of the shortage of investment funds in the UK market at this
moment, but we have a pool of cash to take us through 2009, by which time our
current exploration programme is expected to have completed and other
initiatives may have come to fruition. While we determine the long term
requirements of Indago, we have adopted a policy of outsourcing our technical
and legal support. This has given us access to some first class professional
resources, whilst retaining significant flexibility over our overhead costs.
We are, therefore, developing the strategy to move forward. A success at any of
the wells in our current programme would advance that strategy very rapidly. In
the meantime, we have the resources to be patient.
Dr David Bremner
CEO
REVIEW OF OPERATIONS
SUMMARY OF THE GROUP'S EXPLORATION ASSETS
The Company has been an active explorer and commenced an exploration drilling
campaign in the fourth quarter of 2006 comprising three onshore wells targeting
gas and gas-condensate bearing structures in Oman. This programme is ongoing
under the operatorship of RAK Petroleum.
Block 31, onshore Oman - 50% approximate interest (1)
The Company holds an approximate 50% participating interest in Block 31, onshore
Oman.
The Company announced on 6 February, 2007 that it had spudded the Al Jariya well
on the Jebel Hafit prospect (further details shown in the table below). The
Jebel Hafit prospect straddles the border between the Sultanate of Oman and the
Emirate of Abu Dhabi. It is the second well in the current onshore Oman drilling
campaign.
Significant geological and mechanical challenges were encountered at virtually
every stage of the drilling, including requiring two sidetracks at a depth of
approximately 2,000 metres. After a year of drilling, the operation had reached
5,100 metres. Just beyond this depth, a strong flow of high-temperature,
high-pressure salt water with high levels of carbon dioxide and some gas was
encountered. The well was immediately brought under control by well control
experts recruited to the rig in the Summer of 2007 in anticipation of potential
high temperature and pressure incidents.
As reported in our announcement on 28 March 2008, the examination of the rock
cuttings from the formation acquired just prior to the well control incident
would indicate that the formation encountered is a limestone unit of Campanian
age. This contrasts with the first reservoir objective, the Natih formation,
which is a shelf carbonate of Cenomanian age, some 7 million years older. We
now estimate the Natih to be between 20m and 180m (with a best estimate of 50m)
deeper than the deepest point currently reached (5,131 metres). Furthermore, the
main target, the Shuaiba (Thamama) is anticipated to lie another 200m deeper
than the top of the Natih, separated from the Natih by the Nahr Umr shale, a
regional seal.
The source of the formation fluids which flowed to surface is uncertain.
Temperature information is not conclusive but the fluids could originate from
the limestone stringer encountered, or slightly deeper if a fault had been
intersected.
The conclusions are:
1. The prospect probably remains untested at the Natih level, and even more so
at the Shuaiba (Thamama) level (which was forecast to contain the majority
of the pre-drill success case reserves).
2. In order to drill deeper than the current level we will, at the least, have
to abandon the existing section of open hole below 4,591 metres and
sidetrack from inside the existing casing.
As desribed in the CEO's Report we hope to be able to move beyond this point by
substantially redrilling the portion of the well below 4,300 metres, beyond the
very hard chert sequence. However, given the time required to secure the
required specialised equipment (expandable casing), plus allowing time for over
pressure to dissipate, we, with the Operator, have concluded that in all
likelihood we will suspend the Al Jariya well for a time and redeploy the
drilling rig to the Zad well on the Adam Prospect on Block 47 (see below).
Prospect Well name Target formation (depth) Analogue discoveries Gross mean (a)
name targeted reserves at
IPO
Jebel Hafit Al Jariya Cretaceous age carbonates (5,300m) Sajaa (140 km), 2,081 Bcf gas and
Margham (100 km) 314 MMB of
condensate
(a) Table 5.20 of Competent Person's report, Admission Document. Figures in
table represent 100% of prospective resources. Indago share 49.9999%
There is a key pipeline within 25 km of the structure which carries gas both to
Sohar, a site of major industry development in Oman, and into the United Arab
Emirates (UAE).
Further leads exist; in particular Jebel Wa'bah. The technical evaluation is
ongoing with new seismic having been obtained during the past year.
(1) A third party has an option to acquire an interest of up to 10% in the EPSA
subject to fulfilling certain conditions
Block 47, onshore Oman - 50% approximate interest (1)
The Company holds an approximate 50% participating interest in Block 47, onshore
Oman. In October 2007, the Joint Venture elected to enter the third three year
exploration term under the Exploration and Production Sharing Agreement (EPSA).
The undrilled Adam prospect is detailed in the table below.
Prospect name Well name Target formation (depth) Analogue Gross mean (b)
discoveries targeted reserves at
IPO
Adam Zad Cambrian age sandstones (4,200m) Kauther 445 Bcf gas and 69
MMB of condensate
(40 km.)
(b) Table 5.31 of Competent Person's report, Admission Document. Figures in
table represent 100% of prospective resources. Indago share 49.9999%
Hawamel, on the Izz structure, was drilled during the fourth quarter of 2006,
penetrating the target reservoirs over the period 6th to 12th December, during
which gas shows were recorded. The Natih formation was encountered at a depth of
approximately 2,135 metres and the Thamama formation at approximately 2,585
metres. Following electric logging and Modular Dynamic Tester (formation
pressure testing) operations, the Operator's interpretation is that gas is
present, but that the formation porosities and permeabilities are significantly
lower than prognosed. It is considered unlikely that standard testing procedures
would achieve a commercial flowrate and that a more innovative approach may be
required.
For the time being, however, it has been decided to suspend the well, with
casing down to the existing target formations, in such a way that it can be
easily re-entered. Further operations on the Hawamel well may depend on the
outcome of other exploration in the area.
Block 47, onshore Oman (continued)
The Zad well on the Adam prospect will now likely be drilled during the summer
of 2008 once the drilling rig is freed up from operations on the Al Jariya well.
The well site has already been prepared. The reservoir issues with Hawamel have
no influence on the prospectivity at Zad. The Izz and Adam prospects are fully
independent, targeting different reservoirs, Cretaceous versus Cambrian and
carbonates versus clastics and are dependent on distinct petroleum systems. Both
have nearby analogue discoveries and the necessary elements for success are
present in the area.
In 2007 the acquisition of 362 km of 2D seismic in Block 47 was completed. This
survey was focused on the Dham, Sadood and Kabshat leads. The technical
evaluation is in progress and may result in the promotion of one or more of
these leads to drillable status.
The chance of a discovery in the Block being a commercial success is enhanced by
the proximity of a major pipeline which runs through the Block to Muscat, the
capital and largest population centre of Oman. The pipeline cuts between Zad and
Hawamel, both of which are located within approximately 10 km. of this line. The
viability of the Block could be further enhanced by the combining of the
potential output of Block 47 with that of the adjacent Block 30 which contains
currently undeveloped gas discoveries.
(1) A third party has an option to acquire an interest of up to 10% in the EPSA
subject to fulfilling certain conditions
Block 43A, onshore Oman - 50% approximate interest (2)
The Company holds an approximate 50% participating interest in Block 43A,
onshore Oman, which comprises an area of 2,923 square km. The EPSA with the
Government of the Sultanate of Oman was signed on 28 June 2006.
Targeting Block 43A is consistent with the Company's regional exploration focus
on the gas-condensate fairway of the Oman Mountain Front and is on trend with a
number of existing discoveries - the most notable being the multi-Tcf Sajaa
field.
A seismic acquisition campaign was concluded during 2007. This encompassed the
acquisition of 225 km of 2D seismic in the Block, including over the Kahal lead.
The Joint Venture is also re-processing seismic of older vintage. The technical
evaluation based on this seismic and other regional data is in progress.
(2) A third party has an option to acquire an interest of up to 45% in the
EPSA subject to fulfilling certain conditions
REVIEW BY QUALIFIED PERSON
The technical information and opinions contained in this annual report have been
reviewed by Don Scott, a qualified Geoscientist (BSc (Hons) Geology -
Southampton 1963, MSc Applied Geophysics - Birmingham 1964) and a Fellow of the
Geological Society of London since 1964.
INDAGO PETROLEUM LIMITED
CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2007
Year ended Year ended
31 December 31 December
2007 2006
Notes $000 $000
Revenue 3,771 13,669
Cost of sales (929) (3,552)
Gross profit 2,842 10,147
Exploration costs written off (11,678) (8,923)
Administrative expenses (6,603) (8,742)
Other income 246 509
Profit on disposal of subsidiaries and other assets 5 306,024 -
Profit / (loss) before interest and taxation 290,831 (7,009)
Interest income 3,090 3,373
Finance costs - (200)
Profit / (loss) before taxation 293,921 (3,836)
Taxation (66) -
Profit / (loss) for the year attributable to equity holders 293,855 (3,836)
of the parent
Basic earnings / (loss) per share in US cents 4 551 (7.19)*
Diluted earnings / (loss) per share in US cents 4 511 (7.19)*
* restated following 1 for 5 share consolidation
CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2007
At At
31 December 31 December
2007 2006
$000 $000
NON - CURRENT ASSETS
Intangible assets 22,457 36,762
Property, plant and equipment 112 4,687
22,569 41,449
CURRENT ASSETS
Inventories 55 6,065
Trade and other receivables 353 12,642
Cash and cash equivalents 41,315 44,537
41,723 63,244
TOTAL ASSETS 64,292 104,693
CURRENT LIABILITIES
Trade and other payables (5,618) (23,905)
NON - CURRENT LIABILITIES
Provisions - (566)
TOTAL LIABILITIES (5,618) (24,471)
NET ASSETS 58,674 80,222
EQUITY
Share capital 27 27
Share premium - 112,170
Retained profit / (accumulated losses) 58,647 (31,975)
TOTAL EQUITY 58,674 80,222
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2007
Notes 31 December 31 December
2007 2006
$000 $000
Operating activities
Profit / (loss) before taxation 293,921 (3,836)
Adjustments to reconcile profit / (loss) before taxation to
net cash flows:
Share-based payments 2,310 4,369
Exploration costs written off 5,583 -
Amortisation of and write off of intangible assets 48 174
Depreciation of property, plant and equipment 287 1,043
Profit on disposal of subsidiaries 5 (306,024) -
Interest income (3,090) (3,373)
Finance costs - 200
Tax expense (66) -
Decrease / (increase) in inventories 63 (5,221)
Increase in receivables (1,014) (10,666)
(Decrease) / increase in payables (2,847) 13,667
Increase in provisions 161 151
Net cash flows from operating activities (10,668) (3,492)
Investing activities
Interest received 3,090 3,373
Purchase of property, plant and equipment (7,347) (689)
Purchase of intangible assets in joint ventures (27,259) (35,452)
Proceeds from sale of subsidiaries and other assets net of 356,675 -
cash and cash equivalents disposed off
Net cash flows from investing activities 325,159 (32,768)
Financing activities
Facility and interest expense - (200)
Dividends paid 5 (317,713) -
Net cash flows from financing activities (317,713) (200)
Decrease in cash and cash equivalents (3,222) (36,460)
Cash and cash equivalents at the start of the period 44,537 80,997
Cash and cash equivalents at the end of the period 41,315 44,537
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
GROUP Notes Share capital Share Retained profit / Total $000
$000 premium $000 (accumulated
losses)
$000
At 1 January 2006 27 112,170 (32,508) 79,689
Share-based payment - - 4,369 4,369
Total income and expenses for the year - - 4,369 4,369
recognised in equity
Loss for the year - - (3,836) (3,836)
Total income and expenses for the year - - 533 533
At 31 December 2006 27 112,170 (31,975) 80,222
Share-based payments - - 2,310 2,310
Total income and expenses for the year - - 2,310 2,310
recognised in equity
Profit for the year - - 293,855 293,855
Total income and expenses for the year - - 296,165 296,165
Cancellation of share premium account - (112,170) 112,170 -
Dividend paid 5 - - (317,713) (317,713)
At 31 December 2007 27 - 58,647 58,674
NOTES
1. Accounting policies and presentation of financial information
Indago prepares its consolidated Group accounts in accordance with applicable
International Financial Reporting Standards (IFRS) as adopted by the EU.
2. The summary accounts set out above do not constitute statutory accounts as
defined by section 240 of the UK Companies Act 1985. The summarised
consolidated balance sheet at 31 December 2007, the summarised consolidated
income statement and the consolidated statement of cash flows as well as the
consolidated statement of changes in equity for the year then ended have
been extracted from the Group's audited Annual Report and Financial
Statements for the year ended 31 December 2007 upon which the auditors'
opinion is unqualified. The statutory accounts for the year ended 31
December 2007 were approved by the directors on 9 April 2008.
3. The Annual Report and Accounts for the year ended 31 December 2007 as well as
information regarding the Annual General Meeting will be sent by post to all
registered shareholders in due course.
4. Earnings per ordinary share
The calculation of basic earnings per share is based on a net profit after
taxation attributable to equity shareholders of the parent for the year ended 31
December 2007 of $293,855,000 (year ended 31 December 2006: loss $3,836,000) and
53,333,311 ordinary shares, being the weighted average number of ordinary shares
in issue during the period (31 December 2006: adjusted for the share
consolidation 53,333,311).
The calculation of the diluted earning per share is based on net profit after
taxation attributable to equity shareholders of the parent for the year ended 31
December 2007 of $293,855,000 and 57,458,896 ordinary shares and options, being
the weighted average number of ordinary shares in issue during the period
(53,333,311), plus the weighted average number of 4,125,675 ordinary shares held
under options by past and present employees, advisers and brokers. No other
options would have vested by the end of the period.
In relation to the year ended 31 December 2006, the loss attributable to
ordinary shareholders and the weighted average number of ordinary shares for the
purpose of calculating the diluted earnings per share are identical to those
used for the basic earnings per share. This is because the exercise of share
options would have the effect of reducing the loss per share and is therefore
not dilutive under the terms of IAS 33.
5. Disposal of subsidiaries and other assets
On 5 April 2007, the Company completed the disposal of all of its production and
development assets, as well as 50.0001% of its exploration assets, plus cash on
hand, to RAK Petroleum PCL for a total consideration of �194,235,267
(approximately $383 million) - equivalent to 72.5 pence per share on a fully
diluted basis.
This generated a profit on disposal of approximately $306 million at Group
level. The Board then resolved to return to shareholders 60 pence per share via
an interim, special dividend. As distributable profits of the Company were just
above 50 pence per share, it was necessary to cancel the Company's share premium
account, which stood at approximately $112 million, to release the additional
funds into distributable reserves in order to achieve a 60 pence per share
dividend.
An Extraordinary General Meeting (EGM) was held on 3 April 2007 to approve the
transaction,
to approve the cancellation of the share premium account and to approve the
consolidation of the Company's share capital on a 1 for 5 ratio. All the
resolutions were passed.
A court hearing was held in Guernsey to receive approval for the cancellation of
the share premium account and the special dividend of �160.0 million ($317.7
million) was paid on 18 April 2007.
Assets disposed of completely as a result of the transaction were:
> 40% interest in Block 8 (Bukha and West Bukha production and
development) offshore Oman
> 40% interest in RAK-B block offshore Ras Al Khaimah, UAE
> 40% interest in Saleh block offshore Ras Al Khaimah, UAE
> 100% interest in Block 30 onshore Oman.
In addition, assets in which a 50.0001% interest has been disposed of by the
Group are:
> Block 31 onshore Oman;
> Block 47 onshore Oman; and
> Block 43A onshore Oman.
The profit on disposal has been calculated as follows:
$000 $000
Consideration 382,779
Working capital adjustment (2,563)
Net consideration 380,216
Assets and liabilities of subsidiaries disposed of:
Property, plant and equipment 11,635
Intangible asset 35,933
Current assets 15,311
Cash and cash equivalent 23,541
Less: current liabilities (15,698)
Less: non-current liabilities (723)
(69,999)
Less: professional fees (4,193)
Profit on disposal 306,024
Notes to Editors:
Indago Petroleum Limited is an oil and gas exploration company listed on the AIM
market of the London Stock Exchange. The Company is geographically focused in
the Middle East, currently exploring in the Sultanate of Oman, a politically
stable country with proven hydrocarbon reserves and an active gas market.
Following the disposal of its production and development assets and just over
50% of its exploration assets to RAK Petroleum PCL ("RAK Petroleum" or "the
Operator") in April 2007, Indago currently has an approximate 50% stake in three
exploration blocks onshore Oman (Blocks 31, 47 & 43A) operated by RAK Petroleum.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR SSEFWUSASEIL
Indago Petroleum (LSE:IPL)
Historical Stock Chart
Von Mai 2024 bis Jun 2024
Indago Petroleum (LSE:IPL)
Historical Stock Chart
Von Jun 2023 bis Jun 2024
