TIDMBPC
RNS Number : 6308C
Bahamas Petroleum Company PLC
20 October 2020
20 October 2020
Bahamas Petroleum Company plc
("BPC" or the "Company")
Convertible Note Funding Update
BPC, the Caribbean and Atlantic margin focused oil and gas
company, with exploration, production, appraisal and development
assets across the region, provides the following update in relation
to its Conditional Convertible Notes funding arrangement.
On 10 October 2019, BPC entered into a Conditional Convertible
Note Subscription Agreement (as more particularly described in the
Company's announcement of that date and subsequently in multiple
Company communications to shareholders since that date). Under this
agreement, and subject to satisfaction of various conditions
precedent (as were described in the Company's announcement of 21
August 2019), BPC expects to raise gross proceeds of GBP10.25
million through the issue of convertible notes ("Notes") to a
syndicate of Australian-based investors (the "Subscriber"). Any
funds secured through the issuance of the Notes will be applied by
BPC towards the costs of drilling of Perseverance #1 in The
Bahamas.
BPC and the Subscriber have agreed to extend the date for
satisfaction of all of the conditions precedent to the issue of the
Notes, such that the last date for satisfaction (or waiver by the
Subscriber) of those conditions precedent is now 15 December 2020.
Further, to the extent that the Subscriber elects to subscribe on
an unconditional basis for at least GBP1.5 million of Notes prior
to 15 November 2020, the date for the satisfaction (or waiver by
the Subscriber) of the conditions precedent shall be further
extended to 15 January 2021. BPC has the right to scale back the
Notes by up to 50%, should it elect to do so, at no cost or
penalty.
This revised timing is reflective of the current plan and
schedule for the drilling of Perseverance #1, and is consistent
with BPC's funding strategy. Specifically, given the recent
institutional placement (as announced on 1 October 2020), BPC does
not expect the need for funding from the Notes until toward the
later part of the 45 - 60 day drilling program. Further, whether
funding from the Notes will be required (all or in part or not at
all) will largely be dependent on real-time results encountered
while drilling, in particular the extent to which contingencies
arise.
In terms of potential dilution, assuming the full value of the
Notes were to be drawn without any scale back, and assuming further
that all interest on the Notes was accrued for the full 3-year term
and then all principal and interest were fully converted into
ordinary shares, a total of approximately 590 million new ordinary
shares would be issued to the Subscriber. This potential issuance
was approved by shareholders at the 2019 Annual General
Meeting.
BPC notes that even if the conditions precedent to funding from
the Notes are not satisfied (or waived by the Subscriber) by the
time that funding is required (all or in part), BPC would still
have other funding sources available (as detailed in the Company's
announcement of 1 October 2020).
Status of Conditions Precedent
For the information of shareholders, the key conditions
precedent to subscription for the Notes, and their current status,
are summarised as follows:
-- Condition: BPC having raised sufficient funds (to the
reasonable satisfaction of the Subscriber) to meet the balance cost
of the intended drilling of Perseverance #1 in full, plus the
operating costs of BPC for a period of at least 24 months from the
date of drawdown.
Status: BPC remains to close out this matter with the
Subscriber, but believes this condition to have been satisfied
following the recent institutional placement.
-- Condition : BPC having entered into binding agreements and
contracts necessary and sufficient to enable BPC to conduct the
intended drilling at the estimated cost of those operations,
including a drilling rig contract and a contract for integrated
well services, both with reputable international companies, and
placement of an appropriate insurance policy.
Status : Given contracts in place with Stena Drilling,
Halliburton, Schlumberger, BakerHughes and Weatherford, as well as
the insurance policy placed via AON (as previously announced), BPC
believes that this condition has been satisfied.
-- Condition: BPC securing all necessary permits and approvals
for drilling from the Government of The Bahamas, including all
necessary environmental permits and payment of all necessary
licence fees.
Status : The Company has obtained Environmental Authorisation
for Perseverance #1, which is the applicable permit and approval
requirement under relevant Bahamian laws and regulations. In
relation to fees, as a result of interruptions to the normal
conduct of Government business due to COVID-19, BPC is still
working with the Government on a final reconciliation amounts
payable for the balance of the current 2(nd) exploration period.
BPC expects this to be completed within the timeline required for
satisfaction of this condition.
-- Condition: BPC and the Subscriber entering into suitable
security documentation for the Notes.
Status : BPC and the Subscriber are working collaboratively on
this process. BPC believes that this condition will be able to be
satisfied in a timely manner.
-- Condition : Employment and executive retention arrangements
between nominated key executives and BPC being on terms
satisfactory to the Subscriber.
Status: The Subscriber remains to provide formal confirmation on
this matter, but BPC believes existing contractual arrangements
will satisfy the Subscriber in relation to this condition.
For further information, please contact:
Bahamas Petroleum Company plc Tel: +44 (0) 1624
Simon Potter, Chief Executive Officer 647 882
Strand Hanson Limited - Nomad Tel: +44 (0) 20 7409
Rory Murphy / James Spinney / Jack Botros 3494
Shore Capital Stockbrokers Limited - Tel: +44 (0) 207 408
J oint Broker 4090
Jerry Keen / Toby Gibbs
Investec Bank Plc - J oint Broker Tel: +4 4 (0) 207
Chris Sim / Rahul Sharma 597 5970
CAMARCO Tel: +44 (0) 020 3757
Billy Clegg / James Crothers / Hugo Liddy 4980
The information communicated in this announcement contains
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) No. 596/2014.
Notes to editors
BPC is a Caribbean and Atlantic margin focused oil and gas
company, with a range of exploration, appraisal, development and
production assets and licences, located offshore in the waters of
The Bahamas and Uruguay, and onshore in Trinidad and Tobago, and
Suriname. BPC is currently on-track for drilling an initial
exploration well in The Bahamas, Perseverance #1, in late 2020 /
early 2021, with the well targeting recoverable P(50) prospective
oil resources of 0.77 billion barrels, with an upside of 1.44
billion barrels. In Trinidad and Tobago, BPC has five producing
fields, two appraisal / development projects and a prospective
exploration portfolio in the South West Peninsula. BPC's
exploration licence in Uruguay is highly prospective, with a
potential resource of 1 billion barrels of oil equivalent. In
Suriname, BPC has an onshore appraisal / development project.
BPC is listed on the AIM market of the London Stock Exchange. www.bpcplc.com
END
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