San Leon Energy PLC Update on Conditional Payment Waiver to MLPL (7579K)
September 06 2021 - 1:00AM
UK Regulatory
TIDMSLE
RNS Number : 7579K
San Leon Energy PLC
06 September 2021
Prior to publication, the information contained within this
announcement was deemed by the Company to constitute inside
information for the purposes of Regulation 11 of the Market Abuse
(Amendment) (EU Exit) Regulations 2019/310. With the publication of
this announcement, this information is now considered to be in the
public domain.
6 September 2021
San Leon Energy plc
("San Leon" or the "Company")
Update on the Conditional Payment Waiver in relation to the MLPL
Loan Notes
San Leon, the independent oil and gas production, development
and exploration company focused on Nigeria, provides the following
update regarding its loan to Midwestern Leon Petroleum Limited
("MLPL") (the "Loan Notes").
Background
As previously announced by San Leon, during the course of this
year, San Leon was due to receive, under the Loan Note instrument
which governs the loan it made at the time of its investment in OML
18, its final payments of over US$98 million in three equal
instalments, commencing in July 2021 and completing by December
2021.
MLPL is part of the structure through which San Leon holds its
current 10.58% indirect economic interest in OML 18. San Leon
currently has a 40% equity interest in MLPL with the remaining
interest in MLPL being owned by Midwestern Oil and Gas Company
Limited ("Midwestern"). Midwestern is also the guarantor of the
Loan Notes. MLPL has a 100% equity investment in Martwestern Energy
Limited ("Martwestern"), which in turn has a 98% economic interest
in Eroton Exploration and Production Company Limited ("Eroton"),
which holds a 27% working interest in OML 18 and is its
operator.
On 24 June 2021, San Leon announced that, inter alia, the
Company was in preliminary discussions with Midwestern in relation
to a transaction that would effect a reorganisation to consolidate
Midwestern's holdings in the Company and MLPL into a single holding
in the Company, with the Company holding the remaining 60% equity
interest in MLPL that it does not currently own (the "Potential
Transaction"). It was also announced that it is expected that,
inter alia, as part of the Potential Transaction, the amounts owed
to San Leon by MLPL pursuant to the Loan Notes will be taken into
account in the overall structure and eliminated from the resulting
structure.
On 7 July 2021, San Leon agreed with MLPL, Midwestern and
Martwestern to a conditional payment waiver in respect of the
repayment of approximately US$32 million of MLPL's Loan Notes and
interest that fell due on 5 July (the "Conditional Payment
Waiver"). As part of the terms to the agreement, the Conditional
Payment Waiver expires at the end of August 2021 or, if sooner, the
termination of discussions or the signing of an agreement to effect
the Potential Transaction, and interest will accrue on this
installment of the Loan Notes over this period. The sums to which
the Conditional Payment Waiver relates (and those falling due
within 30 days after the expiry of the Conditional Payment Waiver)
will be payable 90 days after such expiry, save for, inter alia, if
there is an event of default.
Conditional Payment Waiver expiry
San Leon's discussions and considerations regarding the
Potential Transaction described above and more recently on 12 July
2021, remain ongoing, although there continues to be no certainty
that the Potential Transaction will proceed. Accordingly, in this
light, the Conditional Payment Waiver has now expired. However, San
Leon is in discussions to extend the Conditional Payment Waiver in
relation to the MLPL Loan Notes. A further announcement will be
made as appropriate.
Enquiries:
San Leon Energy plc +353 1291 6292
Oisin Fanning, Chief Executive
Allenby Capital Limited
(Nominated adviser and joint broker to the Company) +44 20 3328 5656
Nick Naylor
Alex Brearley
Vivek Bhardwaj
Panmure Gordon & Co
(Joint broker to the Company) +44 20 7886 2500
Nick Lovering
Brandon Hill Capital Limited
(Joint broker to the Company) +44 20 3463 5000
Oliver Stansfield
Jonathan Evans
Tavistock
(Financial Public Relations) +44 20 7920 3150
Nick Elwes
Simon Hudson
Plunkett Public Relations +353 1 230 3781
Sharon Plunkett
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