Directorate Change

RNS Number : 6012F

Independent Oil & Gas PLC

29 July 2016

 

29 July 2016

Independent Oil and Gas plc

Directorate Change

Appointment of David Peattie as Chairman and

Andrew Hay as Senior Independent NED

Independent Oil and Gas plc ("IOG" or the "Company"), the development and production focused Oil and Gas Company, is pleased to announce the appointment of David Peattie as Chairman and Andrew Hay as Senior Independent Non-Executive Director, with immediate effect.  Andrew succeeds Paul Murray who steps down from the Board as a Non-Executive Director, with immediate effect.

David is a highly experienced oil and gas professional with over 35 years' industry experience.  Most recently, David was CEO of Fairfield Energy, an oil & gas company owned by a syndicate of North American and European private equity investors, led by Riverstone and Warburg Pincus.  David began his career at BP in 1979 as a petroleum engineer and during his 33 year tenure at the company held a number of technical, commercial and senior management positions including Head of BP Russia responsible for BP's interests in TNK-BP as well as its businesses in the Russian Arctic and Sakhalin.  In addition, he was BP's lead Director on the board of TNK-BP.

David has a B.Sc. (Hons.) degree and is a Chartered Engineer and Member of the Institute of Materials, Minerals and Mining.

Andrew brings a wealth of corporate finance and capital markets experience to the Company and is currently a managing director in the corporate finance business of the Edmond de Rothschild Group in London, and a director of Edmond de Rothschild Securities (UK) Limited.  Between 1999 and 2014 Andrew ran the corporate finance team at Edmond de Rothschild Securities, specialising in public and private company M&A transactions and capital raising.  Prior to this, Andrew held senior positions at both Schroders and ING Barings between 1976 and 1999.  Andrew is currently senior independent director at Aminex plc, the London Stock Exchange listed East African focused exploration and production company, and sits on Aminex's audit and remuneration committees.

Mark Routh, having been interim Chairman of IOG will remain in his role as CEO.

Mark Routh, CEO of IOG commented:

"We look forward to welcoming David and Andrew to the Board of Independent Oil and Gas.  David brings a deep sector knowledge and strong track record to IOG and his significant oil and gas expertise will be of considerable value to the Company at this important stage in our journey, and in particular with our development and M&A plans.

"Andrew has an extensive track record in corporate finance and capital markets and his current role with Aminex brings broad and current oil & gas experience to IOG.  His appointment as Senior Independent Director further strengthens our Company and Board and we look forward to working with him in his new capacity.

"We thank Paul for his valuable contribution and support to the IOG Board over the last two years and we wish him every success in the future."

David Peattie, Chairman of IOG commented:

"I'm delighted to join Independent Oil & Gas as Non-Executive Independent Chairman.  I have huge respect for what Mark and his executive team have achieved and look forward to working with the team to deliver the next phase of growth and project development.  I would also like to acknowledge the strong financial support London Oil and Gas has provided.

"The Company faces an exciting period of value creating in the UK North Sea where many opportunities exist for the wise investor and reliable partner."

Skipper Appraisal Well

Drilling of the appraisal well on the Skipper licence, of which IOG is 100% owner and operator, successfully spudded on Saturday 23 July and is continuing on schedule.  The Company does not expect to issue any further announcements until the initial well results become available by approximately mid-August.

Issue of shares

The Company has elected to issue 858,112 new ordinary shares of 1 penny ("Ordinary Shares") at 21 pence per Ordinary Share, to an advisor in lieu of fees.  The issue price is based on the closing price of an Ordinary Share on 28 July 2016.

The Company has applied to the London Stock Exchange for admission of the New Ordinary Shares to trading on AIM ("Admission").  Admission is expected to occur on 3 August 2016.  Following Admission there will be 102,586,610 Ordinary Shares in issue.  Accordingly, this number 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 to their interest in the Company under the FCA's Disclosure and Transparency Rules.

-ENDS-

The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014.

Enquiries:

Independent Oil and Gas plc Mark Routh (CEO) Peter Young (CFO)	[phone]
finnCap Ltd Matt Goode/Christopher Raggett (Corporate Finance)	[phone]
Camarco Billy Clegg / Georgia Mann	[phone]

Notes

Schedule 2(g) Disclosures

The following information regarding David Keith Peattie, aged 61, is disclosed under Schedule 2(g) of the AIM Rules for Companies:

Current directorships and/or partnerships	Former directorships and/or partnerships (within the last five years)
Taiga Energy Limited	Fairfield Energy Holdings Limited
	Fairfield Energy Limited
	BP Exploration Service Limited
	BP Trading Limited
	BP Exploration Operating Company Limited
	BP Services International Limited
	Russian Holdings Limited

The following information regarding Andrew Nicholas John Hay, aged 64, is disclosed under Schedule 2(g) of the AIM Rules for Companies:

Current directorships and/or partnerships	Former directorships and/or partnerships (within the last five years)
Aminex PLC	(none)
Edmond De Rothschild Securities (UK) Limited
Lloyd George Advisory (Cayman) Limited
Tollemache Farms Limited

There are no further disclosures to be made under Schedule 2(g) of the AIM Rules for Companies.

About Independent Oil and Gas:

IOG is an oil and gas company with established assets in the UK North Sea.  The company's strategy is to deliver near term development and production assets in North West Europe, through its extensive technical and commercial expertise, whilst maintaining some exposure to exploration upside.  The company is looking to grow both organically and through acquisition.  Following the Blythe acquisition, the Company's combined estimate of 2P reserves in Blythe and 2C resources in Skipper net to IOG are 40.2 MMBoe.

Upon completion of the Cronx acquisition IOG will have five licences in the North Sea.  All of these licences will be owned 100% and operated by IOG.

Further information can be found on www.independentoilandgas.com 

About Blythe:

The Blythe gas discovery in the Rotliegendes Leman formation straddles Blocks 48/22b and 48/23a in the Southern North Sea in licence P1736.  The Blythe Leman needs no further appraisal and has independently verified 2P reserves of 34.3 BCF (6.1 MMBoe).  (Source: ERC Equipoise Competent Person's Report ("CPR") dated September 2013.)

Gas tested to surface from three separate intervals in the Carboniferous beneath the Blythe Leman gas discovery from one of the Blythe discovery wells, 48/23-3 drilled by Arco in 1987.  The maximum rate achieved was 0.9 MMcfd from an unstimulated vertical test.  (Source: End of well report 48/23-3 - November 1987.)  This was deemed uncommercial at the time, before the advent of horizontal multi-fracture stimulated wells.  Further technical work including seismic reprocessing and remapping needs to be completed to evaluate this potential resource to refine the gas-in-place estimates which are between 70 BCF and 310 BCF.  (Source: Tullow Oil 48/23a Relinquishment Report - May 2009.)

Oil has flowed to surface from the naturally fractured Zechstein Carbonates in the Hauptdolomit formation above the Blythe Leman gas discovery from two wells.  Well 48/22-1 drilled by Burmah in 1966 flowed 39° API oil at rates up to 2,000 barrels per day (Source: Composite well log 48/22-1 - October 1966) and well 48/23-3 drilled by Arco in 1987 at flowed 38° API oil at a maximum rate of 1,128 barrels of oil a day.  (Source: End of well report 48/23-3 - November 1987.)  The extent of the structure and potential oil resources in the Hauptdolomit remains unknown.  Previous estimates considered that the mapped closure was probably small.  Oil-in-place has been estimated between 2 MMBbls and 4 MMBbls.  (Source: Tullow Oil 48/23a Relinquishment Report - May 2009.)  Further evaluation and re-mapping is now warranted now that a development will proceed on the main Blythe gas discovery.

About Skipper:

The Skipper oil discovery is in Block 9/21a in the Northern North Sea in licence P1609.  IOG owns 100% of the Skipper licence P1609 and is the Operator.  Skipper needs further appraisal by drilling a well to retrieve an oil sample in order to design the optimum field development plan.  Skipper has independently verified gross 2C resources of 26.2 MMBbls.  IOG management estimates that the recoverable oil from Skipper is 34.1 MMBbls based on a recovery factor of 25%, compared to the historic CPR estimate of 19%.  Successful flow tests from nearby heavy oil fields substantiate the company's estimate of a 25% recovery factor.  The appraisal well will also target two exploration prospects directly beneath the Skipper oil discovery which may contain oil in place of 46 MMBbls.  (Source: AGR Tracs CPR dated September 2013.)

About Cronx:

IOG has agreed to acquire 100% of Cronx (Block 48/22a, licence P1737) which is subject to completion.  The Cronx gas discovery is 14km north-west of the Blythe field.  Cronx was discovered in 2007 by well 48/22b-6 drilled by Perenco UK Ltd.

IOG commissioned an independent CPR by ERC Equipoise on Cronx in July 2012 which shows a base case expected gas recovery of 17.6 BCF or 3.4 MMBOE 2C resource.  IOG anticipates drilling a well in 2016, subject to rig availability, the necessary permits and funding.  IOG expects the well to confirm the recoverable resources, which IOG believes has the potential to be larger than the 17.6 BCF base case in the CPR.  IOG is currently evaluating options for the development and export of the Cronx gas.

About Truman and Harvey

IOG has a 100% working interest in a licence awarded in the 27th licensing round to the east of Blythe containing the Truman prospect and Harvey discovery.  IOG estimates potential resources in this licence of 16 BCF or 3.1 MMBoe.  These 100%-owned fields have potential resources that could be tied back to nearby infrastructure being developed for the Blythe development.

About Elgood and Hambleton:

IOG has a 100% working interest in a licence awarded in the 28th licensing round to the west of Blythe containing the Elgood discovery (Block 48/22c, licence P2260).  Elgood was drilled by Enterprise Oil in 1991 and tested gas to surface at 17.6 MMcfd but was not progressed by Enterprise due to size and gas prices at that time.  IOG's estimate of the recoverable reserves in Elgood is 2.1 MMBoe.

The Hambleton discovery, to the south of the same licence, was drilled by Century Exploration in 2005 but also was not progressed to development.  IOG estimates that Hambleton has recoverable resources of 6 BCF (1 MMBoe).  IOG believes that the reprocessing of existing 3D seismic data could increase recoverable resources up to 26 BCF.

There are prospective resources on licence P2260 of 5.3 MMBoe in the Tetley and Rebellion prospects.  Reprocessing of existing 3D seismic across 48/22a and 48/22c is ongoing to determine whether Elgood connects to Cronx which would boost recoverable reserves significantly.  The new seismic interpretation will also determine the likely size of Hambleton.  IOG is now working on the potential development plans and will commission a CPR‎ to confirm the resources over this area.

Competent Person's Statement:

In accordance with the AIM Note for Mining and Oil and Gas Companies, IOG discloses that Mark Routh, IOG's CEO and Interim Executive Chairman is the qualified person that has reviewed the technical information contained in this announcement.  Mark Routh has an MSc in Petroleum Engineering and has been a member of the Society of Petroleum Engineers since 1985.  He has over 35 years' operating experience in the upstream oil and gas industry.  Mark Routh consents to the inclusion of the information in the form and context in which it appears.

 

END

 

 

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