TIDMBOR
RNS Number : 9986H
Borders & Southern Petroleum plc
30 November 2022
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN, IS
RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN
WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO ANY MEMBER STATE
OF THE EUROPEAN ECONOMIC AREA, THE UNITED STATES (OR TO ANY U.S.
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ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION
OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS DEFINED IN
ARTICLE 7 OF THE MARKET ABUSE REGULATION EU NO. 596/2014, AS
RETAINED AND APPLICABLE IN THE UK PURSUANT TO SECTION 3 OF THE
EUROPEAN UNION (WITHDRAWAL) ACT 2018, UPON THE PUBLICATION OF THIS
ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN
THE PUBLIC DOMAIN.
30 November 2022
Borders & Southern Petroleum plc
("Borders & Southern" or the "Company")
GBP2.5 million Fundraising
Borders & Southern (AIM: BOR), the London based independent
oil and gas exploration company with assets offshore the Falkland
Islands, is pleased to announce that it has raised GBP2.5 million,
before expenses to advance studies in its 100% Darwin Gas
Condensate discovery. The fundraising comprises a Firm Placing,
using existing pre-emptive allotment authorities and a Conditional
Placing and a Conditional Subscription, both conditional on
shareholder approval to disapply pre-emption rights.
The fundraising will comprise, subject to the necessary
shareholder approval being granted, the issue, in aggregate of
142,857,138 is new ordinary shares in the Company ("Ordinary
Shares") at a price of 1.75 pence (the "Issue Price") per new
Ordinary Share (the "Fundraising"). The Issue Price is an
approximate 44 per cent. discount to the Company's closing price of
3.15 pence on 30 November 2022.
Highlights of the Fundraising:
-- The Company is committed to advancing its 100% interest in
its large Gas Condensate discovery at its Darwin asset, which
contains over 3.2 TCF GIP (unrisked, Best Estimate) and 462 MMbbl
of Liquids designated Contingent & Prospective Resources
(unrisked, Best Estimate), split across Darwin East & West, and
as independently assessed under the SPE PRMS Standard
-- Scoping project economics by Management suggest that a phased
development project with initial production of 26,000 bbl/d from
Darwin East could deliver NPV(10) of $4/bbl to $10/bbl dependent on
oil price (range $60 to $90 per barrel).
-- GBP1.85 million raised through a firm placing of 105,714,281
Ordinary Shares (the "Firm Placing Shares") at the Issue Price (the
"Firm Placing")
-- GBP0.3 million raised through the conditional placing of
17,142,857 Ordinary Shares (the "Conditional Placing Shares") at
the Issue Price (the "Conditional Placing")
-- GBP0.35 million raised through the conditional subscription
direct with the Company by Harry Dobson, the Company's
Non-Executive Chairman of 20,000,000 Ordinary Shares (the
"Conditional Subscription Shares") at the Issue Price (the
"Conditional Subscription")
Use of Proceeds
The proceeds of the Fundraising will be used to fund the
Company's Licence fees, Discovery Area fees, technical and
commercial studies, general & administrative expenses and, more
generally, to advance the Company's Darwin project towards
appraisal.
Howard Obee, Chief Executive Officer of Borders & Southern,
commented:
"This Fundraising will allow us to advance further technical and
commercial studies for a potential appraisal and development of
Darwin via a conventional FPSO and phased development concept.
"This is a period of elevated world-wide energy prices and
increasing global E&P activity and Darwin is a large
undeveloped discovery with attractive scoping economics. We look
forward to reporting on the phased development concept as our
studies progress.
"We would like to thank existing shareholders and new investors
for their support in the Fundraising."
General Meeting
The Company is to utilise current allotment authorities to
deliver the Firm Placing. The Company requires further authorities
to deliver the Conditional Placing and the Conditional Subscription
and a general meeting to provide these authorities (the "General
Meeting") will be held on or about 20 December 2022. A circular to
convene the General Meeting will be circulated to shareholders of
the Company shortly. The General Meeting will propose resolutions
to shareholders to grant the board authority to allot each of the
Conditional Placing Shares and the Conditional Subscription Shares
are on a non-pre-emptive basis and to provide a further general
authority on a non-pre-emptive basis until the annual general
meeting for the Company to be held in 2023 to replace those
authorities which will have been utilised by the Firm Placing. Once
published, the circular will be available to download from the
Company's website. It is important that shareholders lodge their
votes in advance of the General Meeting through submission of their
proxy votes. A further announcement will be made on publication of
the Circular.
Director Participation and Related Party Transaction
Harry Dobson, the Company's Non-Executive Chairman, is the sole
participant in the Conditional Subscription, details on which are
outlined below:
Director Position Conditional Shareholding
Subscription following Second
Shares being Admission
subscribed
for
Non-Executive
Harry Dobson Chairman 20,000,000 81,372,000
--------------- -------------- ------------------
Harry Dobson's existing shareholding in the Company, amounting
to 10.44%, is held by Zila Corporation. Mr Dobson is expected to
have a result shareholding percentage in the Company of 8.9%
post-First Admission and 11.1% post-Second Admission.
The participation in the Conditional Subscription by Harry
Dobson is a related party transaction for the purposes of AIM Rule
13 of the AIM Rules for Companies due to Mr Dobson being a director
of the Company, and a Substantial Shareholder. The Directors of the
Company independent of Mr Dobson consider, having consulted with
Strand Hanson Limited, the Company's Nominated Adviser, that the
terms of the Conditional Subscription are fair and reasonable in so
far insofar as the Company's shareholders are concerned.
Admissions and Total Voting Rights
Application has been made for admission of the Firm Placing
Shares to trading on AIM ("First Admission") and it is expected
that First Admission will occur on or around 6 December 2022. The
Firm Placing Shares will rank pari passu with the existing Ordinary
Shares of 1 pence each in the capital of the Company ("Ordinary
Shares").
Following First Admission (of the Firm Placing Shares), the
total issued share capital of the Company will consist of
693,671,599 Ordinary Shares each with voting rights. The Company
does not hold any Ordinary Shares in treasury. Therefore, the total
number of voting rights in the Company will be 693,671,599 and this
is the figure may be used by shareholders as the denominator for
the calculations by which they will determine if they are required
to notify their interest in, or a change in their interest in, the
share capital of the Company under the FCA's Disclosure Guidance
and Transparency Rules.
Application will be made for the Conditional Placing Shares and
Conditional Subscription Shares (together, the "Second Admission
Shares"), to trading on AIM following the requisite resolutions
being passed at the General Meeting ("Second Admission") and it is
expected that Second Admission will occur on or around 21 December
2022.
For further information please visit www.bordersandsouthern.com
or contact:
Borders & Southern Petroleum plc
Howard Obee, Chief Executive
Tel: 020 7661 9348
Strand Hanson Limited (Nominated Adviser)
Ritchie Balmer / James Bellman
Tel: 020 7409 3494
SP Angel Corporate Finance LLP (Broker)
Richard Hail / Stuart Gledhill / Adam Cowl
Tel: 020 3470 0470
Tavistock (Investor Relations)
Simon Hudson / Nick Elwes
Tel: 020 7920 3150
Notes:
Borders & Southern Petroleum plc is an oil & gas
exploration company listed on the London Stock Exchange AIM (BOR).
The Company operates and has a 100% interest in three Production
Licences in the South Falkland Basin covering an area of nearly
10,000 square kilometres. The Company has acquired 2,517 square
kilometres of 3D seismic and drilled two exploration wells, making
a significant gas condensate discovery with its first well.
-ends-
Glossary
bbl barrel
Best Estimate With respect to resources categorization,
the most realistic assessment
of recoverable quantities if only
a single result were reported.
If probabilistic methods are used,
there should be at least a 50%
probability (P50) that the quantities
actually recovered will equal
or exceed the best estimate.
------------------------------------------
Condensate A mixture of hydrocarbons (mainly
pentanes and heavier) that exist
in the gaseous phase at original
temperature and pressure of the
reservoir, but when produced,
are in the liquid phase at surface
pressure and temperature conditions.
Condensate differs from NGLs in
two respects: (1) NGL is extracted
and recovered in gas plants rather
than lease separators or other
lease facilities, and (2) NGL
includes very light hydrocarbons
(ethane, propane, or butanes)
as well as the pentanes-plus that
are the main constituents of condensate.
------------------------------------------
Contingent Resources Those quantities of petroleum
estimated, as of a given date,
to be potentially recoverable
from known accumulations by application
of development projects, but which
are not currently considered to
be commercially recoverable owing
to one or more contingencies.
------------------------------------------
GIP The total quantity of gas that
is estimated to exist originally
in naturally occurring reservoirs,
as of a given date.
------------------------------------------
MM million
------------------------------------------
Liquids A mixture of light hydrocarbons
that exist in the gaseous phase
in the reservoir and
are recovered as liquids in gas
processing plants. NGLs differ
from condensate in
two principal respects: (1) NGLs
are extracted and recovered in
gas plants rather
than lease separators or other
lease facilities, and (2) NGLs
include very light
hydrocarbons (ethane, propane,
or butanes) as well as the pentanes-plus
that are
the main constituents of condensates.
------------------------------------------
Prospective Resources Those quantities of petroleum
estimated, as of a given date,
to be potentially recoverable
from undiscovered accumulations
by application of future development
projects.
------------------------------------------
TCF Trillion cubic feet
------------------------------------------
NPV(10) Net present value of estimated
future net cash flows discounted
at a 10% interest rate
------------------------------------------
SPE Society of Petroleum Engineers
------------------------------------------
SPE PRMS Standard The Petroleum Resources Management
System (PRMS) is a system developed
for consistent and reliable definition,
classification, and estimation
of hydrocarbon resources. The
Oil and Gas Reserves Committee
has completed the revision of
the Petroleum Resources Management
System (PRMS) and the SPE Board
approved it in June 2018.
------------------------------------------
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END
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