Oilex Ltd Capital Funding Program (2353U)
July 28 2015 - 2:00AM
UK Regulatory
TIDMOEX
RNS Number : 2353U
Oilex Ltd
28 July 2015
Dear Shareholder,
Capital Funding Program
I am writing to you about your Company's announcement on 7 July
2015, regarding a capital funding program which is currently in
progress. You should have recently received a Notice of Meeting for
a General Meeting of Oilex shareholders to be held on 12 August
2015, as well as an Offer Booklet pertaining to a fully
underwritten rights issue for eligible shareholders. The General
Meeting and the rights issue are components of a A$30 million
capital funding program by Oilex to fund its 2015/16 work programme
in India, minimum work commitments in the Canning Basin and working
capital. This growth opportunity is underpinned by the recent
Independent Reserve Classification of gross proven plus probable
(2P) reserves of 206 Bcf of natural gas and 8 million bbls of
condensate (light oil) in the Cambay Field, India.
The major part of the fundraising requires your voting support.
The Board believes that the resolutions to be proposed at the
General Meeting are in the best interests of the Company and
Shareholders as a whole. Accordingly, the Directors unanimously
recommend that all Shareholders vote in favour of the resolutions,
as they intend to do so, in respect of their own beneficial
shareholdings. The purpose of this letter is asking you to vote in
favour of the resolutions proposed by your Board as set out in the
Notice of Meeting.
It is important to understand why this transaction is very much
in your interest and the interests of all stakeholders as Oilex
progresses its transformation into a sustainable business based
upon production, cash flow and reserves growth at the Cambay
Project in Gujarat State, India. Your Board has reviewed a range of
different funding structures and opportunities before selecting a
structure of a two Tranche Placement and fully underwritten
renounceable one (1) for four (4) rights issue for existing
Shareholders to secure the requisite funding package totalling A$30
million. At the time of writing this letter, Tranche 1 is complete
and the fully underwritten rights issue is in progress and is
expected to be completed before the General Meeting.
Oilex has recently announced its first local market gas sales
from our Cambay Field in India, a significant milestone for the
business towards growing revenue and essential to being
operationally cash flow positive in India, a key corporate
milestone for 2015. In addition to Cambay-73, other gas production
wells coming online during 2015 will include Cambay-77H and
Bhandut-3. India has a fast growing economy where natural gas
attracts a premium price and the demand is strong, which should
allow Oilex to quickly expand its business.
The fundraising will facilitate the following approved work
programmes:
-- Cambay Field
o Drilling and completion of two horizontal multistage
production wells (Cambay-78H and Cambay-80H)
o Workover operations on five existing wells
o Engineering studies for, amongst other things, a larger
development of 50MMscfd gas production on plateau
-- Bhandut Field
o Gas production facilities to support gas sales from Bhandut-3
well
-- Canning Basin - Wallal Graben Play Fairway
o Technical work to develop a leads and prospects portfolio to
facilitate a farm-out
It is anticipated that the successful delivery of the Cambay
Field 2015/16 work programme will be a transformational event for
Oilex as we deliver significantly enhanced commercialisation of our
hydrocarbon reserves.
By voting to support the fundraising process either by Proxy or
in person at the General Meeting on 12 August, you will ensure that
your Company has the necessary funds available to undertake its
growth plans and create sustainable value for all Shareholders and
Stakeholders.
Thank you for your ongoing support and we look forward to
growing our Company together.
For and on behalf of Oilex Ltd
Ron Miller
Managing Director
28 July 2015
This information is provided by RNS
The company news service from the London Stock Exchange
END
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