Resolution of Capital Gains Tax liability

RNS Number : 7971V

Rockhopper Exploration plc

18 December 2013

 



18 December 2013

Rockhopper Exploration plc

("Rockhopper")

Resolution of Capital Gains Tax liability

Rockhopper Exploration plc (AIM: RKH), the North Falkland Basin oil and gas exploration company, is pleased to announce that it has reached an agreement in principle with the Falkland Islands Government ("FIG") regarding the timing and quantum of the Capital Gains Tax ("CGT") liability due as a result of its farm out to Premier Oil of a 60 per cent equity interest in its Sea Lion discovery.

Following extensive discussions, the parties have now agreed in principle that the total CGT payable is $146m with payment split into two tranches. The first payment, due immediately, equates to $42m, of which Rockhopper paid $39m in June 2013.  The second payment equates to $104m and will now be paid at the same time as the first royalty payment to FIG from oil production at Sea Lion. The liability is to be settled in GB£ at the exchange rate prevailing at farm out completion of $1.6134/£.  Further detail will be covered in the interim results which are anticipated to be released shortly.

Documentation of the above agreement will now commence, with a view to becoming effective by the end of January 2014.

Sam Moody, CEO of Rockhopper, commented:

'I am pleased that we have now reached agreement with FIG and that the uncertainty over the quantum of CGT Liability is now resolved. This is an important commercial milestone for Rockhopper as we drive the Sea Lion development forward with our partner.'

Ends.

Rockhopper Exploration plc

Tel: (via Vigo Communications) - 020 7016 9571

Sam Moody - Chief Executive

Peter Dixon-Clarke - Finance Director

Canaccord Genuity Limited (NOMAD and Joint Broker)

Tel: [phone]

Henry Fitzgerald-O'Connor

Vigo Communications

Tel: [phone]

Peter Reilly

Patrick d'Ancona

 

END

 

 

MSCEAKAXFSFDFFF