Nervesa Update & Open Offer Supplementary Circular

RNS Number : 2337Q

Sound Oil PLC

16 June 2015

 

16 June 2015

Sound Oil plc

("Sound Oil" or the "Company")

Nervesa Update and Open Offer Supplementary Circular

Sound Oil, the European / Mediterranean focused upstream oil and gas company announces that it has decided to abandon the second appraisal well pending a possible sidetrack at its onshore Nervesa discovery. 

Despite the confirmed presence of gas and the completion of reperforation and stimulation operations in the lower section of the target reservoir, the Company has been unable to secure a stabilised flow rate.  The Company has therefore concluded that the lower section of the target reservoir is insufficiently permeable to flow gas.   With no material gas shows in the upper section of the target reservoir, the Company has decided to abandon the well.  It is the Company's intention, subject to permitting, to retain the top-hole facilities at site in anticipation of a future sidetrack.

The Company will now turn its attention towards:

·     achieving first gas at the first Nervesa well, where construction of production facilities is expected to commence shortly; and

·     preparing for the first well in respect of its newly acquired interest in Morocco.

The Company invites shareholders to a conference call at 09:00 on Friday 19 June 2015.  For details please contact [e-mail].

James Parsons, Sound Oil's Chief Executive Officer, commented:

"I am disappointed to report that, whilst we found gas in the lower portion of the reservoir, the level of permeability encountered was insufficient, despite reperforation and stimulation operations, to establish a flow.  We will be evaluating the result of this well to assess the remaining prospectivity in the licence area and consider a sidetrack.

"The Company remains very well positioned with a diverse and well balanced portfolio of assets in Italy and Morocco and a strong cash balance (over Euro 26 million on completion, later this month, of the second tranche of the placing first announced by the Company on 28 April 2015). 

"We are rapidly approaching commercial production at the first Nervesa well, the drilling of the first appraisal well in Morocco and the permitting and farm out of the Badile exploration well.  I therefore see this well result as a frustrating but relatively minor set-back.

"The Sound Oil team and I remain committed to building a mid cap Mediterranean gas company."

Publication of Supplementary Circular and Extension to Open Offer

On 21 May 2015, the Company announced the publication of a circular (the "Circular") in respect of an open offer to eligible shareholders (the "Open Offer"). The Open Offer has, to date, received a strong response from eligible shareholders.  

The Company announces that it will shortly be posting a supplementary circular to Eligible Shareholders in respect of the Open Offer (the "Supplementary Circular"). Details of the Open Offer, which was first announced by the Company on 18 May 2015, were included in the Circular.

The Circular and the Supplementary Circular will be available from the Company's website at www.soundoil.co.uk. Capitalised terms in this announcement have the meanings given to them in the Circular, except where the context requires otherwise.

In light of the new information contained, inter alia, above, Sound Oil is now extending the timetable for acceptances (and all other relevant dates) under the Open Offer.

The purpose of the Supplementary Circular is to (i) provide Eligible Shareholders with the updated information contained in this announcement and in relation to entry by the Company into the Tendrara licence farm in agreement (announced on 8 May); (ii) provide details of an extended timetable of principal events of the Open Offer; and (iii) to provide Eligible Shareholders with details of the procedure for applying for Open Offer Shares or withdrawing any application made for Open Offer Shares prior to the date of the Supplementary Circular, should they wish to do so based on the updated information contained within the Announcement.

Open Offer Timetable

In order to provide Eligible Shareholders with sufficient time to consider the additional information, the Company has decided to extend the Open Offer timetable, such that the last time and date for receipt of completed Application Forms and payment in full under the Open Offer and settlement of relevant CREST instructions (as appropriate) be extended to 11.00 a.m. on 23 June 2015. As a result, the revised expected timetable of the remaining principal Open Offer events is as follows.

Recommended latest time for requesting withdrawal of Open Offer Entitlements and Excess CREST Open Offer Entitlements from CREST	4.30 p.m. on 17 June 2015
Latest time for depositing Open Offer and Excess Open Offer Entitlements into CREST	3.00 p.m. on 18 June 2015
Latest time for splitting of Application Forms (to satisfy bona fide market claims only)	3.00 p.m. on 19 June 2015
Latest time and date for withdrawing (in whole or in part) Open Offer acceptances made prior to the date of the Supplementary Circular	11.00 a.m. on 23 June 2015
Latest time and date for receipt of completed Application Forms and payment in full under the Open Offer and settlement of relevant CREST instructions (as appropriate)	11.00 a.m. on 23 June 2015
Expected date of announcement of results of the Open Offer through an RIS	on or by 24 June 2015
Expected time and date for Admission and commencement in dealings in the Open Offer Shares on AIM	8.00 a.m. on 25 June 2015
Expected date for crediting of the Open Offer Shares and Open Offer Warrants in uncertificated form to CREST accounts	25 June 2015
Expected date of dispatch of definitive share/warrant certificates for the Open Offer Shares and Open Offer Warrants	6 July 2015

References to times in this announcement are to London time (unless otherwise stated). The dates and timing of the events in the above timetable and in the rest of the announcement are indicative only and may be subject to change at the absolute discretion of the Company. If any of the above times or dates should change, the details of the revised times and/or dates will be notified to AIM and, where appropriate, to Shareholders.

For further information please contact:

Sound Oil James Parsons, Chief Executive Officer	[e-mail]
Vigo Communications - PR Adviser Patrick d'Ancona Chris McMahon	Tel: [phone]
Smith & Williamson - Nominated Adviser Azhic Basirov David Jones Ben Jeynes	Tel: [phone]
Peel Hunt -Broker Richard Crichton Charles Batten	Tel: [phone]

The information contained in this announcement has been reviewed by Sound Oil's Italian Managing Director, Luca Madeddu, a qualified petroleum geologist.

 

END

 

 

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