26 Sep 2019
1H 2019 Interim ResultsIndependent Oil and Gas plc ("IOG" or the "Company") (AIM: IOG.L), the AIM-listed development and production focused oil and gas company with key interests in the Southern North Sea (“SNS”), is pleased to present its unaudited interim results for the six months ended 30 June 2019.
- SNS Core Project expanded to include the 108 BCF 2C Contingent Resources at Goddard;
- Engineering and design work for Phase 1 Southwark and Blythe platforms progressed following successful completion of geotechnical surveys; and
- Tendering processes initiated for Phase 1 platform and SURF scopes.
Corporate and Financial Highlights
- Institutional equity fundraise; fully subscribed open offer and Board/management subscription, raising gross aggregate proceeds of £18.9 million;
- Conversion and restructuring of LOG debt;
- Relationship Agreement signed with LOG;
- Rejection of indicative proposal from Rockrose Energy;
- Appointment of Esa Ikaheimonen as Senior Independent Non-Executive Director and Chair of Audit Committee; and
- Appointment of Neil Hawkings as Independent Non-Executive Director and Chair of HSE and Technical Committee.
Post-Period End Highlights
- Signing of definitive documents to farm out 50% of the Company’s portfolio, excluding Harvey, to CalEnergy Resources Limited (“Farm-out”);
- Successful raise of EUR100 million 5-year bond (“Bond”) which sees the Company fully funded for Phase 1 of the Core Project;
- Drilling of Harvey appraisal well;
- Signing of SPA to acquire the Thames Reception Facilities at Bacton Gas Terminal; and
- Area of Mutual Interest (“AMI”) agreement with CalEnergy Resources Limited.
- Completion of Farm-out to CalEnergy Resources Limited;
- FID and commencement of Core Project Phase 1 project execution;
- Full Harvey appraisal well results; and
- CalEnergy Resources Limited option to farm in to Harvey.
Andrew Hockey, CEO of IOG, said:
The full Interim Report can be downloaded here
In challenging circumstances, the IOG team has achieved a series of very significant steps to unlock the value of our portfolio during 1H19 and thereafter. Most notably we completed an institutional fund raise in April 2019 which, along with a Board and Management subscription and a fully subscribed open offer, raised gross proceeds of £18.9 million. Other significant highlights include the restructuring and conversion of existing debt facilities, the successful defence from a possible hostile takeover, contractor bid processes for Phase 1 platform and SURF contracts and strengthening of the board with two high-quality new non-executive directors in Esa Ikaheimonen and Neil Hawkings.
Post period end, we signed the farm-out agreement with CalEnergy Resources Limited, signed an SPA to acquire the Thames Reception Facilities at Bacton, and successfully raised a EUR100 million bond to complete the balance of required Phase 1 funding. We have also drilled the Harvey appraisal well in under two months with no HSE incidents, confirming a 49ft gas column, and are currently assessing the detailed well results to generate updated volume estimates.
I am immensely proud of everything the team has achieved to date this year. We continue to focus our efforts on ensuring that all remaining Farm-out completion conditions, which consist of routine consents and agreements with third parties, are met as soon as possible. At completion we will be fully funded for the Phase 1 development execution phase and we remain as focused as ever on delivering value for our shareholders.
Certain information communicated in this announcement was, prior to its publication, inside information for the purposes of Article 7 of Regulation 596/2014.
|Independent Oil and Gas plc
Andrew Hockey (CEO)
James Chance (CFO)
|+44 (0) 20 3879 0510|
|+44 (0) 20 7220 0500|
|Peel Hunt LLP
|+44 (0) 20 7418 8900|
|+44 (0) 20 7390 0230|
About Independent Oil and Gas
Subject to completion of the farm-out transaction announced on 26 July 2019, IOG will own and operate a 50% stake in substantial low risk, high value gas reserves in the UK Southern North Sea. The Company’s Core Project targets a net 2P peak production rate of 69 MMCF/d (c. 12kBoe/d) from net 2P gas Reserves of 151 BCF¹ + 2C gas Contingent Resources of 55 BCF², via an efficient hub strategy. In addition to the independently verified 2P reserves at Blythe, Elgood, Southwark, Nailsworth and Elland and 2C Contingent Resources at Goddard, IOG also has independently verified best estimate net unrisked prospective gas resources of 37 BCF² at Goddard and is in the process of updating its management estimate of gas resources at Harvey. Alongside this IOG continues to pursue value accretive acquisitions to generate significant shareholder returns.
¹ERC Equipoise Competent Persons Report: October 2017, adjusted by Management to account for updated project timing and compression
²ERC Equipoise Goddard Competent Persons Report: October 2018