Completion of Acquisition
July 28 2010 - 5:30AM
UK Regulatory
TIDMEDR TIDMEO.
RNS Number : 0585Q
Egdon Resources PLC
28 July 2010
28 July 2010
For Immediate Release
EGDON RESOURCES PLC
("Egdon" or "the Company")
Completion of the Acquisition of Certain UK Assets from EnCore Oil plc
and Appointment of Director
Further to the announcement of 22 March 2010, the Directors of Egdon Resources
plc are pleased to announce the completion of the acquisition of certain of
EnCore Oil plc's ("EnCore") assets by Egdon ("the Acquisition").
The package of assets acquired comprise of EnCore's entire interest in nine
onshore UK licences and an interest in the Ceres gas field in the Southern North
Sea.
As consideration for the Acquisition, Egdon has issued 39,200,000 Ordinary
Shares ("the Consideration Shares") to EnCore, which represent 29.998 per cent.
of the enlarged share capital of the Company. Application has been made for
admission of the Consideration Shares to trading on AIM, which is expected to
become effective on 29 July 2010. The total number of Egdon Ordinary Shares in
issue on admission will be 130,675,774.
Completion also triggers a number of other terms of the transaction, namely;
Lock-in Arrangements - whereby EnCore and certain of its subsidiaries have
undertaken not to dispose of any Consideration Shares for a period of 12 months
from the date of their admission to trading on AIM.
Non-Compete Arrangements - under which, other than by agreement, Egdon will
restrict its offshore activities in the UK and EnCore will restrict its onshore
operations in the UK and France to the areas adjoining their respective existing
operations.
Technical Services Agreement - whereby EnCore and Egdon have agreed to provide
each other with certain services in connection with each of their businesses
and the development of the Assets following the Acquisition.
Facility Agreement - under which EnCore has agreed to provide Egdon with access
to an unsecured loan facility for the purpose of exploration and development
activities of Egdon and its affiliates. The Facility Agreement provides a term
loan facility for a period of two years in an aggregate amount equal to
GBP1,500,000 which can be drawn down at the request of Egdon in tranches of
GBP250,000 at an interest rate of 10% or LIBOR plus 5% if greater.
The acquisition of EnCore E&P Limited which holds the Nimes and Mairy permits in
France is expected to complete later in the year. The consideration for this
will be GBP100,000 in cash.
Board Appointment
EnCore have a right on completion to appoint a non-executive director to the
Egdon Board for a period of five years thereafter, provided that either it holds
15 per cent. or more of the share capital of Egdon or it is the largest
shareholder of the Company.
Accordingly, we are pleased to report that Alan Booth, the Chief Executive
Officer of Encore, has today been appointed as a non-executive Director of
Egdon. Prior to co-founding EnCore, Alan Booth was Chairman and Managing
Director of EnCana (U.K.) Limited (now Nexen Petroleum U.K. Limited), and a
member of EnCana Corporation's executive management team. He was instrumental in
building EnCana UK from a new UK entrant in late 1996 with a $55 million
exploration funding obligation into a significant UK production operator and the
discoverer and development operator for the Buzzard field. In late 2004 Alan
lead the UK team which sold EnCana (U.K.) Limited to Nexen Corporation for $2.1
billion. Prior to EnCana, Alan worked in a number of positions of increasing
seniority for Amerada Hess and Oryx Energy both in the UK and overseas. He has
particular experience in new ventures acquisitions and exploration in the UK,
Scandinavia, Australasia as well as the Middle East and Africa.
From December 2003 until March 2005, Alan was President of the United
Kingdom Offshore Operators Association (UKOOA) the representative body for all
UKCS offshore operators. He also subsequently served as a Director of Oil & Gas
UK and was a member of PILOT, the main forum for Government-Industry liaison
chaired by the Energy Minister, as well as being a member of the Industry
Leadership Team (ILT). In 2003, he was elected President of the Petroleum
Exploration Society of Great Britain; in April 2004 Alan was awarded the
Petroleum Group Silver Medal by the Geological Society in recognition of his
contribution to the Industry. Alan's background is in geoscience and he holds a
BSc in Geology from Nottingham University, and a Masters Degree in Petroleum
Geology from the Royal School of Mines, Imperial College London.
Alan is a current director of industry body OGIA.
Alan Booth, aged 52, currently holds the following directorships; EnCore
Exploration Limited, EnCore Natural Resources Limited, EnCore Petroleum Limited,
EnCore North Sea Limited, EnCore Oil plc, EnCore Oil and Gas Limited, EnCore
(E&P) Limited, EnCore (NNS) Limited, EnCore (VOG) Limited, EnCore Gas Storage
Limited, Oil and Gas Independents' Association Limited
Within the last five years, Alan Booth has held the following directorships;
EnCore (SNS) Limited, Nexen Petroleum UK Holdings Limited, Petroleum Exploration
Society of Great Britain Limited, United Kingdom Offshore Operators Association
Limited, Oil and Gas UK Limited, RWA DEA UK EC Limited, The United Kingdom
Offshore Oil and Gas Industry Association Limited
Commenting on today's announcement, Mark Abbott, Managing Director of Egdon
said:
"We are pleased to report the successful completion of the acquisition of these
UK assets from EnCore which provide a significant increase in our opportunity
base from which to develop and grow our business over the coming years. The
assets are an excellent strategic fit with our existing portfolio and we look
forward to fully integrating them into Egdon's business. Key amongst them are
the Ceres gas field, an increased interest in the Kirkleatham gas development,
the Biscathorpe Prospect adjacent to our Keddington oil field in Lincolnshire
and an interest in two near-term exploration wells in the Weald Basin (Markwells
Wood-1 and Havant-1).
I would also like to welcome Alan Booth to Egdon's Board. Alan is a highly
experienced and respected member of the UK oil and gas industry and we look
forward to his input and advice in the development of Egdon's business over the
coming years"
For further information please contact:
Egdon Resources plc
Mark Abbott, Managing Director
01256 702292
Buchanan Communications
Richard Darby, James Strong
020 7466 5000
Nominated Adviser and Broker - Seymour Pierce
Jonathan Wright, Richard Redmayne
020 7107 8000
Notes to Authors
The Assets Acquired:
The assets acquired in relation to today's announcement are summarised in the
table below and described in more detail in our release of 22 March 2010 which
is available on our website (www.egdon-resources.com).
+------------+-+---------------+-------------+--------+----------------------+
| Licence | Location | Operator | Encore | Egdon Subsidiary |
| | | | % | acquiring the Asset |
+------------+-----------------+-------------+--------+----------------------+
| ONSHORE UK | | | |
+------------------------------+-------------+--------+----------------------+
| PEDL068 | Cleveland | Egdon | 20% | Egdon Resources U.K. |
| | | | | Limited |
+--------------+---------------+-------------+--------+----------------------+
| PEDL098 | Wessex | Northern | 7.5% | Egdon Resources U.K. |
| | | Petroleum | | Limited |
+--------------+---------------+-------------+--------+----------------------+
| PEDL125 | Weald | Northern | 10% | Egdon Resources U.K. |
| | | Petroleum | | Limited |
+--------------+---------------+-------------+--------+----------------------+
| PEDL126 | Weald | Northern | 10% | Egdon Resources U.K. |
| | | Petroleum | | Limited |
+--------------+---------------+-------------+--------+----------------------+
| PEDL154 | Weald | Northern | 10% | Egdon Resources U.K. |
| | | Petroleum | | Limited |
+--------------+---------------+-------------+--------+----------------------+
| PEDL155 | Weald | Northern | 10% | Egdon Resources U.K. |
| | | Petroleum | | Limited |
+--------------+---------------+-------------+--------+----------------------+
| PEDL256 | Weald | Northern | 7.5% | Egdon Resources U.K. |
| | | Petroleum | | Limited |
+--------------+---------------+-------------+--------+----------------------+
| PEDL240 | Wessex | Northern | 7.5% | Egdon Resources U.K. |
| | | Petroleum | | Limited |
+--------------+---------------+-------------+--------+----------------------+
| PEDL253 | Humber | Encore | 60% | Egdon Resources U.K. |
| | | | | Limited |
+--------------+---------------+-------------+--------+----------------------+
| SOUTHERN NORTH SEA | | | |
+------------------------------+-------------+--------+----------------------+
| 47/9c | SNS | Venture | 5% | Egdon Resources |
| | | | | Europe Limited |
+--------------+---------------+-------------+--------+----------------------+
| 47/9c | SNS | Venture | 5% | Egdon Resources U.K. |
| | | | | Limited |
+--------------+---------------+-------------+--------+----------------------+
| | | | | | |
+------------+-+---------------+-------------+--------+----------------------+
Egdon Resources plc
Egdon Resources plc (LSE: EDR) is an established UK-based exploration and
production company primarily focused on onshore exploration and production in
the hydrocarbon-producing basins of the UK and Europe.
Egdon currently holds interests in thirty five licences in the UK and France and
has an active programme of exploration, appraisal and development within its
balanced portfolio of oil and gas assets. Egdon is an approved operator in both
the UK and France.
Egdon has production from the Keddington and Kirklington oil fields in the East
Midlands the Avington oil field in Hampshire and the Ceres gas field on the
UKCS. Further oil and gas production is anticipated from Kirkleatham
Eakring-Dukes Wood and Waddock Cross in 2010.
On completion of the acquisition of Encore E&P Limited, Egdon will acquire a
further two permits onshore France.
Egdon has recently announced a disposal of its French subsidiary to eCORP. This
will result in two French permits being transferred from Egdon ownership on
completion.
Egdon Resources plc listed on AIM in January 2008, following the demerger of its
gas storage business, Portland Gas plc (now renamed Infrastrata plc). The
pre-demerged business was formed in 1997 and listed on AIM in December 2004.
www.egdon-resources.com
In accordance with the AIM Rules - Note for Mining and Oil and Gas Companies,
the information contained in this announcement has been reviewed and signed off
by the Managing Director of Egdon Resources plc Mark Abbott, a Geoscientist with
over 23 years experience.
Certain statements in this announcement are forward-looking statements which are
based on the Company's expectations, intentions and projections regarding its
future performance, anticipated events or trends and other matters that are not
historical facts. These statements are not guarantees of future performance and
are subject to known and unknown risks, uncertainties and other factors that
could cause actual results to differ materially from those expressed or implied
by such forward-looking statements. Given these risks and uncertainties,
prospective investors are cautioned not to place undue reliance on
forward-looking statements. Forward-looking statements speak only as of the date
of such statements and, except as required by applicable law, the Company
undertakes no obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events or otherwise.
The information contained in this Announcement is subject to change without
notice and the Company does not assume any responsibility or obligation to
update publicly or review any of the forward-looking statements contained
herein.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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