TIDMRRL
RNS Number : 5914R
Range Resources Limited
30 October 2019
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY
THE COMPANY TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER
THE MARKET ABUSE REGULATIONS (EU) NO. 596/2014 ("MAR"). UPON THE
PUBLICATION OF THIS ANNOUNCEMENT VIA REGULATORY INFORMATION SERVICE
("RIS"), THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE
PUBLIC DOMAIN.
QUARTERLY ACTIVITIES REPORT
Range provides its quarterly activities report for the period
ended 30 September 2019 (Q1 FY20) with the following
highlights:
-- Average production for the quarter of 563 barrels of oil per day ("bopd");
-- Production increased by 12% from the previous quarter,
following commissioning of upgraded storage facilities and
completed workovers;
-- SPA signed with LandOcean for the sale of RRTL in exchange
for offsetting all outstanding debt and payables (US$91.5 million
as at 30 June 2019) and a cash consideration of US$2.5 million,
subject to shareholders' approvals and Trinidad government
approvals;
-- Subscription for new ordinary shares to raise GBP750,000 completed;
-- Cash position of US$2.4 million (unaudited);
-- Subsequent to the quarter end:
o SPA signed for the sale of four drilling rigs and related
equipment for a total cash consideration of US$3.6 million; and
o Applied for the voluntary delisting from ASX which is expected
to occur at close of trading on 25 November 2019.
DETAILED REVIEW OF THE QUARTER
TRINIDAD
Production
Total net production for the quarter was 51,823 barrels of oil
(net 563 bopd), which is a 12% increase from production in the
previous quarter. This includes production from the Beach Marcelle
and Morne Diablo waterflood programmes which continued at average
rates of 166 bopd and 22 bopd, respectively.
Production increase was mainly attributed to higher production
at the Beach Marcelle field following the commissioning of upgraded
storage facilities. In addition, some of the completed workovers at
the Morne Diablo and Beach Marcelle fields produced at higher rates
than anticipated. In total, 30 workovers were completed during the
period.
Morne Diablo infrastructure upgrades
During the quarter, the Company commenced small scale
infrastructure upgrades at the Morne Diablo field, which comprise
repair and modification of the storage tanks. These upgrades are
required to ensure the facilities meet regulatory standards.
Geological tool studies
As previously advised, the Company acquired a new geological
tool to undertake studies on its fields that are expected to
significantly enhance subsurface understanding, and assist in
identifying shallow reservoirs and economic well locations. The
Company is in the process of testing the geotool and acquiring data
for correlation.
CORPORATE
Proposed debt restructuring and RRTL sale
During the quarter, the Company announced that it signed a
binding conditional Sale and Purchase Agreement with LandOcean for
the sale of Range Resources Trinidad Limited ("RRTL") (the "SPA")
in exchange for (i) offsetting all outstanding debt and payables
(including the convertible note) due from Range and its
subsidiaries to LandOcean and its subsidiaries, and (ii) a cash
consideration of US$2.5 million (the "Transaction"). RRTL holds
interests in all of Range's oil and gas licences in Trinidad
(onshore), namely Morne Diablo, South Quarry, Beach Marcelle (where
RRTL holds a 100% interest), and St Mary's (where RRTL holds an 80%
interest).
On completion, all outstanding debt from Range and its
subsidiaries to LandOcean and its subsidiaries (including the US$20
million convertible note) will be fully repaid by offsetting
against the consideration and all underlying debt agreements will
be terminated. From the date of signing the SPA and up to the
completion date, all payables by Range to LandOcean under any
underlying debt agreements will be deferred. The maturity date of
the US$20 million convertible note will change to the earlier of
the date on which completion occurs under the SPA or the longstop
date (being 30 June 2020). As part of the agreements, LandOcean
undertakes not to issue a conversion notice.
Completion of the SPA is subject to satisfaction (or waiver) of
the following key conditions:
-- Approval by Range shareholders at General Meeting of the
Company, as the Transaction would be a material disposal falling
under AIM Rule 15 and the ASX Listing Rules and Corporations Act
2001 (Cth). The General Meeting is planned for 29 November
2019;
-- Approval by LandOcean shareholders at the General Meeting of
LandOcean, with the date of this meeting to be determined; and
-- Approvals by the government of Trinidad and Tobago.
There can be no guarantee that the Transaction and debt
restructuring will complete.
GBP0.75 million subscription
During the quarter, the Company completed a subscription for new
ordinary shares to raise GBP0.75 million. As part of the
subscription, the investor can nominate up to two non-executive
directors to the Board of the Company and shall retain this ability
for so long as it holds 10% or more of the Company's shares in
issue.
Director resignation
During the quarter, Ms Juan Wang tendered her resignation as
Non-Executive Director of the Company.
Drilling rigs sale
Subsequent to the quarter end, Range signed a Sale and Purchase
Agreement with Wilson Energy Services Inc., a private company
incorporated in Canada (the "Buyer") for the sale of four drilling
rigs and related equipment of Range Resources Drilling Services
Limited ("RRDSL", the "Seller") for a total cash consideration of
US$3.6 million.
Completion is subject to satisfaction of final inspection of the
rigs and equipment by the Buyer and delivery of various
documentation related to the rigs by the Seller, including
documentation required for the transfer of ownership of the rigs by
the Trinidad Transport Board and the Licensing Authority. The
agreed long stop date for this transaction is 8 November 2019.
If the Transaction completes, RRDSL's residual rigs would
comprise 7 workover and swabbing rigs and 1 drilling rig. RRDSL
will continue to provide oilfield services to Range and other
operators in Trinidad.
Georgia legal action
Subsequent to the quarter end, after careful consideration,
Range withdrew the previously submitted Notice of Arbitration
against Georgia on a without prejudice basis.
Trinidad and Tobago tax appeals
As previously disclosed, the Company is involved in tax appeals
in Trinidad and Tobago. The total amount of all liabilities in
dispute against Range is approximately US$4.9 million, which has
been prudently accrued by the Company. Whilst discussions continue,
the matters have been listed for hearing in November 2019. The
Company will provide an update on any matters as and when there are
any material developments.
Voluntary delisting from ASX
Subsequent to the quarter end, the Company applied to ASX
requesting that ASX remove the Company from the official list of
ASX (the "Official List") pursuant to ASX Listing Rule 17.11 and
ASX accepted its application and resolved to remove the Company
from the Official List, subject to the satisfaction of the
conditions at close of trading on 25 November 2019. The Company
will be sending out further information to ASX shareholders
advising of options with regards to their shareholding.
PETROLEUM TENEMENTS HELD AT THE OF THE QUARTER (APPIX A)
Tenement Reference Location Working Interest Operator
================== ========= ================ =======================
Morne Diablo Trinidad 100% Range
================== ========= ================ =======================
South Quarry Trinidad 100% Range
================== ========= ================ =======================
Beach Marcelle Trinidad 100% Range
================== ========= ================ =======================
St Mary's Trinidad 80% Range
================== ========= ================ =======================
Perlak(1) Indonesia 23% Aceh Timur Kawai Energi
================== ========= ================ =======================
Notes:
1. Range's indirect interest in the Perlak field is held through
its 60% shareholding in Hengtai, which holds a 78% interest in
Lukar which in turn holds a 49% interest in Aceh Timur Kawai
Energi.
Competent Person statement
The information contained in this announcement has been reviewed
and approved by Mr Lubing Liu. Mr Liu is a suitably qualified
person with over 24 years of industry experience. He holds a BSc in
Petroleum Engineering from the Southwest Petroleum University,
China and is a member of the SPE (Society of Petroleum Engineers).
Mr Liu holds the role of Chief Operating Officer and Trinidad
General Manager with the Company.
Contact details
Cantor Fitzgerald Europe (Nominated
Range Resources Limited Adviser and Broker)
Evgenia Bezruchko (Group Corporate David Porter / Rick Thompson
Development Manager & Joint Company (Corporate Finance)
Secretary) t. +44 (0)20 7894 7000
e. admin@rangeresources.co.uk
t. +44 (0)20 3865 8430
Appendix 5B
Mining exploration entity and oil and gas exploration entity
quarterly report
Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97,
01/07/98, 30/09/01, 01/06/10, 17/12/10, 01/05/13, 01/09/16
Name of entity
-----------------------------------------------------
Range Resources Limited
ABN Quarter ended ("current quarter")
--------------- ----------------------------------
88 002 522 009 30 September 2019
----------------------------------
Consolidated statement of cash Current quarter Year to date
flows $US'000
(3 months)
$US'000
1. Cash flows from operating
activities
1.1 Receipts from customers 1,200 1,200
1.2 Payments for
(a) exploration & evaluation - -
(b) development (61) (61)
(c) production (368) (368)
(d) staff costs (626) (626)
(e) administration and corporate
costs (1,665) (1,665)
1.3 Dividends received (see note - -
3)
1.4 Interest received 2 2
1.5 Interest and other costs of - -
finance paid
1.6 Income taxes (paid)/refunded 943 943
1.7 Research and development refunds - -
1.8 Other (provide details if - -
material)
---------------- -------------
Net cash from / (used in)
1.9 operating activities (575) (575)
----- ------------------------------------- ---------------- -------------
2. Cash flows from investing
activities
2.1 Payments to acquire:
(a) property, plant and equipment - -
(b) tenements (see item 10) - -
(c) investments - -
(d) other non-current assets - -
2.2 Proceeds from the disposal
of:
(a) property, plant and equipment - -
(b) tenements (see item 10) - -
(c) investments - -
(d) other non-current assets - -
2.3 Cash flows from loans to - -
other entities
2.4 Dividends received (see note - -
3)
2.5 Other (provide details if - -
material)
---------------- -------------
2.6 Net cash from / (used in) - -
investing activities
------- ----------------------------------- ---------------- -------------
3. Cash flows from financing
activities
3.1 Proceeds from issues of shares 925 925
3.2 Proceeds from issue of convertible - -
notes
3.3 Proceeds from exercise of - -
share options
3.4 Transaction costs related - -
to issues of shares, convertible
notes or options
3.5 Proceeds from borrowings - -
3.6 Repayment of borrowings - -
3.7 Transaction costs related - -
to loans and borrowings
3.8 Dividends paid - -
3.9 Other (provide details if - -
material)
---------------- -------------
Net cash from / (used in)
3.10 financing activities 925 925
------- ----------------------------------- ---------------- -------------
4. Net increase / (decrease)
in cash and cash equivalents
for the period
Cash and cash equivalents
4.1 at beginning of period 2,116 2,116
Net cash from / (used in)
operating activities (item
4.2 1.9 above) (575) (575)
4.3 Net cash from / (used in) - -
investing activities (item
2.6 above)
Net cash from / (used in)
financing activities (item
4.4 3.10 above) 925 925
Effect of movement in exchange
4.5 rates on cash held (96) (96)
---------------- -------------
Cash and cash equivalents
4.6 at end of period 2,370 2,370
------- ----------------------------------- ---------------- -------------
5. Reconciliation of cash and Current quarter Previous quarter
cash equivalents $US'000 $US'000
at the end of the quarter
(as shown in the consolidated
statement of cash flows) to
the related items in the accounts
5.1 Bank balances 2,370 2,116
5.2 Call deposits - -
5.3 Bank overdrafts - -
5.4 Other - -
---------------- -----------------
Cash and cash equivalents
at end of quarter (should
5.5 equal item 4.6 above) 2,370 2,116
---- ----------------------------------- ---------------- -----------------
6. Payments to directors of the entity and Current quarter
their associates $US'000
Aggregate amount of payments to these parties
6.1 included in item 1.2 687
----------------
6.2 Aggregate amount of cash flow from loans -
to these parties included in item 2.3
----------------
6.3 Include below any explanation necessary to understand
the transactions included in items 6.1 and 6.2
----- -----------------------------------------------------------------
Directors' fees and Directors' consulting fees.
7. Payments to related entities of the entity Current quarter
and their associates $US'000
7.1 Aggregate amount of payments to these parties -
included in item 1.2
----------------
7.2 Aggregate amount of cash flow from loans -
to these parties included in item 2.3
----------------
7.3 Include below any explanation necessary to understand
the transactions included in items 7.1 and 7.2
---- ----------------------------------------------------------------
-
8. Financing facilities available Total facility Amount drawn
Add notes as necessary for amount at quarter at quarter end
an understanding of the position end $US'000
$US'000
8.1 Loan facilities 20,000 20,000
------------------- ----------------
8.2 Credit standby arrangements - -
------------------- ----------------
8.3 Other (please specify) - -
------------------- ----------------
8.4 Include below a description of each facility above, including
the lender, interest rate and whether it is secured or
unsecured. If any additional facilities have been entered
into or are proposed to be entered into after quarter
end, include details of those facilities as well.
---- -------------------------------------------------------------------------
The details of the US$20,000,000 convertible loan facility
are as follows:
Issuer: Range Resources Limited
Noteholder: LandOcean Energy Services Co., Ltd
------------------------------------------
Amount: US$20,000,000
------------------------------------------
Maturity Date: 28 November 2019 (i)
------------------------------------------
Repayment: Bullet at maturity date
------------------------------------------
Interest: 8% per annum, payable annually in arrears
------------------------------------------
Security: None
------------------------------------------
Conversion Price: GBP0.0088 per share
------------------------------------------
Lender Conversion At any time, in a minimum amount of
Right: US$10,000,000
------------------------------------------
(i) As per SPA dated 2 September 2019, a maturity date is the
earlier of 30 June 2020 and the date on which completion occurs.
Under SPA, LandOcean undertakes not to issue a conversion notice.
On completion of Range Resources Trinidad Limited sale to LandOcean,
all borrowings (including the convertible note) will be waived
and form part of the transaction consideration.
9. Estimated cash outflows for next $US'000
quarter
9.1 Exploration and evaluation -
9.2 Development -
9.3 Production 400
9.4 Staff costs 500
9.5 Administration and corporate costs 500
9.6 Other (provide details if material) -
--------
9.7 Total estimated cash outflows 1,400
---- ------------------------------------ --------
10. Changes in tenements Tenement Nature of interest Interest Interest
(items 2.1(b) reference at beginning at end
and 2.2(b) above) and location of quarter of quarter
10.1 Interests in - - - -
mining tenements
and petroleum
tenements lapsed,
relinquished
or reduced
----- --------------------- -------------- ------------------- -------------- ------------
10.2 Interests in - - - -
mining tenements
and petroleum
tenements acquired
or increased
----- --------------------- -------------- ------------------- -------------- ------------
Compliance statement
1 This statement has been prepared in accordance with accounting
standards and policies which comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters disclosed.
Sign here: Date: 29 October 2019
Director
Print name: Zhiwei Gu
Notes
1. The quarterly report provides a basis for informing the
market how the entity's activities have been financed for the past
quarter and the effect on its cash position. An entity that wishes
to disclose additional information is encouraged to do so, in a
note or notes included in or attached to this report.
2. If this quarterly report has been prepared in accordance with
Australian Accounting Standards, the definitions in, and provisions
of, AASB 6: Exploration for and Evaluation of Mineral Resources and
AASB 107: Statement of Cash Flows apply to this report. If this
quarterly report has been prepared in accordance with other
accounting standards agreed by ASX pursuant to Listing Rule 19.11A,
the corresponding equivalent standards apply to this report.
3. Dividends received may be classified either as cash flows
from operating activities or cash flows from investing activities,
depending on the accounting policy of the entity.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
UPDWGGACUUPBUQU
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