TransAtlantic Petroleum Ltd. (TSX:TNP) (NYSE
American:TAT) (the “Company” or “TransAtlantic”) today announced
the launch of a new drilling program, its entry into a new
approximately $20.4 million term loan under its current credit
facility and a related pledge fee agreement, and the decision to
pay the upcoming quarterly dividends on the Company’s 12.0% Series
A Convertible Redeemable Preferred Shares (“Series A Preferred
Shares”) in cash.
New Drilling Program
With receipt of proceeds from the 2017 Term Loan
(as described below), the Company is launching a new drilling
program. The Company plans to begin drilling the Selmo-81H1 well
starting in the first quarter of 2018 and is working to identify
additional wells to follow.
Additionally, the Company is evaluating its
prospects in the Thrace Basin in Turkey in light of Valeura Energy
Inc.’s positive interim production test results at the Yamalik-1
exploration well. The Yamalik-1 exploration well is in a license
that is directly adjacent to the Company’s licenses in the Thrace
Basin, which cover a total of approximately 120,000 net
acres.
New Term Loan
On August 23, 2016, the Turkish branch of
TransAtlantic Exploration Mediterranean International Pty Ltd
(“TEMI”), a subsidiary of the Company, entered into a general
credit agreement (the “Credit Agreement”) with DenizBank, A.S. (the
“Lender”). The Credit Agreement is a master agreement pursuant to
which the Lender may make loans to TEMI from time to time pursuant
to additional loan agreements.
On November 28, 2017, the Lender entered into an
additional approximately $20.4 million term loan (the “2017 Term
Loan”) with TEMI under the Credit Agreement. The 2017 Term Loan is
in addition to the Company’s term loan currently outstanding with
the Lender, as described in the Company’s previous periodic reports
filed from time to time with the Securities and Exchange
Commission.
The 2017 Term Loan bears interest at a fixed
rate of 6.0% (plus 0.3% for Banking and Insurance Transactions Tax
per the Turkish government) per annum. The 2017 Term Loan has a
grace period through July 2018 during which the 2017 Term Loan
bears no interest and no payments are due. Thereafter, the 2017
Term Loan is payable in one monthly installment of approximately
$1.4 million in July 2018, nine monthly installments of $1.2
million each through April 2019, five monthly installments of $1.0
million each through September 2019, one monthly installment of
$1.2 million in October 2019, and two monthly installments of $1.0
million each through December 2019. The 2017 Term Loan matures in
December 2019.
The 2017 Term Loan will be secured by a pledge
of (i) the stock of DMLP, Ltd. (“DMLP”), TransAtlantic Turkey, Ltd.
(“TransAtlantic Turkey”), Talon Exploration, Ltd. (“Talon
Exploration”), (ii) substantially all of the assets of TEMI, (iii)
certain real estate owned by Petrogas, (iv) the Gundem real estate
and Muratli real estate owned by Gundem Turizm Yatirim ve
Isletmeleri A.S. (“Gundem”), (v) certain Diyarbakir real estate
owned 80% by N. Malone Mitchell 3rd and 20% Selami Erdem Uras, and
(vi) certain Ankara real estate owned 100% by Mr. Uras. In
addition, TEMI will assign its Turkish collection accounts and its
receivables from the sale of oil to the Lender as additional
security for the 2017 Term Loan. Gundem is beneficially owned by
Mr. Mitchell, his adult children, and Mr. Uras. Mr. Mitchell is the
Company’s Chief Executive Officer and Chairman of the Board. Mr.
Uras is the Company’s Vice President, Turkey. The Company is
working with the Lender to enter into certain pledges and
assignment agreements with the shareholders of Gundem, Mr.
Mitchell, and Mr.
Uras.
New Pledge Fee Agreement
In connection with the pledge of the Ankara real
estate to the Lender as collateral for the 2017 Term Loan, on
November 28, 2017, the Company entered into a pledge fee agreement
with Mr. Uras pursuant to which the Company will pay Mr. Uras a fee
equal to 5% per annum of the collateral value (deemed to equal $5.2
million) of the Ankara real estate.
Payment of Dividends on Series A
Preferred Shares in Cash
The Board of Directors of the Company has
decided to pay the upcoming quarterly dividends on the Series A
Preferred Shares in cash. The upcoming quarterly dividends are
payable on December 31, 2017 to holders of record on December 15,
2017.
About TransAtlantic
The Company is an international oil and natural
gas company engaged in the acquisition, exploration, development,
and production of oil and natural gas. The Company holds interests
in developed and undeveloped properties in Turkey and Bulgaria.
(NO STOCK EXCHANGE, SECURITIES
COMMISSION, OR OTHER REGULATORY AUTHORITY HAS APPROVED OR
DISAPPROVED THE INFORMATION CONTAINED HEREIN.)
Forward-Looking Statements
This news release contains statements concerning
the entry into of the 2017 Term Loan and use of proceeds therefrom,
the launch of a new drilling program, and the payment of a cash
dividend on its shares of Series A Preferred Stock, as well as
other expectations, plans, goals, objectives, assumptions, and
information about future events, conditions, results of operations,
and performance that may constitute forward-looking statements or
information under applicable securities legislation. Such
forward-looking statements or information are based on a number of
assumptions, which may prove to be incorrect.
Although the Company believes that the
expectations reflected in such forward-looking statements or
information are reasonable, undue reliance should not be placed on
forward-looking statements because the Company can give no
assurance that such expectations will prove to be correct.
Forward-looking statements or information are based on current
expectations, estimates, and projections that involve a number of
risks and uncertainties which could cause actual results to differ
materially from those anticipated by the Company and described in
the forward-looking statements or information. These risks and
uncertainties include, but are not limited to, access to sufficient
capital; market prices for natural gas, natural gas liquids and oil
products; estimates of reserves and economic assumptions; the
ability to produce and transport natural gas, natural gas liquids,
and oil products; the results of exploration and development
drilling and related activities; economic conditions in the
countries and provinces in which the Company carries on business,
especially economic slowdowns; actions by governmental authorities;
receipt of required approvals; increases in taxes; legislative and
regulatory initiatives relating to fracture stimulation activities;
changes in environmental and other regulations; renegotiations of
contracts; political uncertainty, including actions by insurgent
groups or other conflict; outcomes of litigation; the negotiation
and closing of material contracts; and other risks described in the
Company’s filings with the SEC.
The forward-looking statements or information
contained in this news release are made as of the date hereof and
the Company undertakes no obligation to update publicly or revise
any forward-looking statements or information, whether as a result
of new information, future events or otherwise, unless so required
by applicable securities laws.
Contacts:
Chad D. BurkhardtVice President, General Counsel and Corporate
Secretary(214) 265-4705TransAtlantic Petroleum Ltd.16803 Dallas
ParkwayAddison, Texas
75001http://www.transatlanticpetroleum.com
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