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Urals Energy PCL (UEN)

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Monday 06 August, 2018

Urals Energy PCL

Operational updates

RNS Number : 8504W
Urals Energy Public Company Limited
06 August 2018
 

6 August 2018

Urals Energy Public Company Limited

 

("Urals Energy", the "Company" or the "Group")

 

Operational updates

 

The Board of Urals Energy (AIM:UEN), the independent exploration and production company with operations in Russia, provides the following operational updates.

 

Drilling of Well 1 at South Dagi

The drilling of the Group's planned exploration well (Well 1) at the South Dagi field on Sakhalin Island has reached a depth of approximately 1,400 meters. Some 20 days of operation have been lost for separate minor technical reasons, but drilling is now advancing at a rate of 30 to 50 meters per day. Well 1 has a target depth of 2,200 meters, with the well's target pay horizons being the Okobycay and the Daginsky neogenic horizons.  The Board anticipates that the drilling of Well 1 should be completed and tested by the second week of September.

 

Tanker payment

Further to the Company's announcement of 20 July 2018, the Company has now received payment from Petraco Oil Company Limited following the tanker shipment in mid-July 2018. The pre-export short-term loan finance arrangement provided by Petraco Oil Company Limited (as detailed in the Company's announcement of 24 May 2018), including accrued interest, has now been settled in full.

 

The Board anticipates that the second 2018 tanker loading for Articneft will be in November 2018, with a target of up to 20,000 tons of special light crude oil (158,000 barrels).

 

Investment in Kholmsk port

The Company's Petrosakh subsidiary has acquired a 23% voting interest in the Kholmsk commercial seaport, which is situated on the Western side of Sakhalin Island.  The Company's interest in the Kholmsk commercial seaport is comprised of 17,858,826 ordinary shares (out of a total of 64,940,000 ordinary shares that are in issue) and 2,262,000 preference shares (out of a total of 21,646,000 preference shares that are in issue).

 

The seaport has bunkering facilities to supply fuel oil to shipping fleets and ferries, which are the main users of the seaport.  The Group's refinery at Petrosakh on Sakhalin Island refines all of the Company's crude oil production on the island, including producing fuel oil.  The Board has therefore made the investment in the Kholmsk commercial seaport to assist with marketing its diesel and fuel oil directly to end users.  The Company already has a bunker fuel sales operations at Kholmsk and this will benefit from the investment.

 

The Company intends to seek to appoint three representative directors to the seaport's board (out of a total board of seven directors) at a forthcoming general meeting to be held on 27 August 2018.

 

The Company purchased its 27.5% interest in the ordinary shares and its 10.45% interest in the preference shares from an individual, Mr. Dmitry Vasilevich.  In addition, the Company has acquired Russian Roubles 8.46 million of the Kholmsk commercial seaport's outstanding debt under an assignment agreement from its creditor, Enhance NDS LLC.  The total consideration for the Company's investment in the seaport is approximately Russian Roubles 119.5 million (which is currently equivalent to approximately US$ 1.9 million).

 

- Ends -

 

For further information, please contact:

 

Urals Energy Public Company Limited


Andrew Shrager, Chairman

Leonid Dyachenko, Chief Executive Officer

Tel: +7 495 795 0300

Sergey Uzornikov, Chief Financial Officer

www.uralsenergy.com

 

 

 

 

 

Allenby Capital Limited

Nominated Adviser and Broker


Nick Naylor / Alex Brearley

Tel: +44 (0) 20 3328 5656


www.allenbycapital.com

 


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