Baron Oil PLC Update on Operations (6617A)
March 28 2017 - 2:00AM
UK Regulatory
TIDMBOIL
RNS Number : 6617A
Baron Oil PLC
28 March 2017
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY
BARON OIL PLC TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER
THE MARKET ABUSE REGULATION (EU) NO. 596/2014 ("MAR"). ON THE
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION
SERVICE ("RIS"), THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN
THE PUBLIC DOMAIN.
Baron Oil PLC
Update on Operations
Baron Oil PLC (AIM:BOIL) ("Baron" or "Company") announces the
following updates to its operations.
Peru Block Z-34
Baron recently announced that Union Oil and Gas Group ("UOGG")
had failed to pay the US$2 million due to its Peruvian subsidiary,
Gold Oil Peru SAC ("GOP") within 5 business days of execution of
the assignment of a 30% interest in Block Z-34 under the terms of
the 2013 Farm-in Agreement (the "FIA") This is still outstanding
and, after consultation with its legal advisers, Baron has today
served a formal notice to UOGG of a material breach of the FIA and
threatened to take legal action if the amount is not paid promptly.
In addition, the material breach of the FIA has caused GOP to give
30 days' notice of termination of the agreement under which UOGG
assumed day-to-day operatorship of the technical work on Block Z-34
on a contract basis. In reality, GOP has had to remain very
involved in the technical processes and if the outstanding amount
is not paid, GOP will resume full control of activities and attempt
to drive forward preparations for a drilling programme.
Peru Block XXI
Preparations are being made to drill a well on Block XXI in
2017, subject to success in bringing in a funding partner.
Discussions are underway with an interested party but there is no
guarantee they will be successful. However, the recent devastating
floods in Peru have made it impossible for us to carry out surveys
on the site and we have requested Perupetro to grant a temporary
period of Force Majeure to give the Company more time to make the
necessary environmental, archaeological and other studies.
Southeast Asia
We are pleased to report that the joint studies with SundaGas
have enabled Baron to participate in the review of a range of
prospective projects with a mix of existing production, undeveloped
discoveries and low-risk exploration. Three of these have been
selected to move forward to the negotiation phase, one of which has
had a confidential application formally submitted. The directors
are hopeful that the application will be successful and that an
announcement can be made in the second quarter of this year. In the
meantime, we are continuing our relationship with SundaGas by
paying our pro rata share of expenditures on these selected
projects.
UK - InfraStrata PLC loan
The Company has been informed that the LIR200,000 drawn down
against the Loan Facility with InfraStrata PLC will be repaid on 31
March 2017. Note that although the Loan Facility terminates on that
day, under the terms of the Loan Facility Agreement, Baron will
receive a GBP200,000 payment if the Islandmagee gas storage project
is sold prior to the end of 2018 (GBP100,000 for a partial
sale).
Bill Colvin, Chairman of Baron, commented: "We appreciate this
is a frustrating time for shareholders, given the continuing delays
brought about by governmental bureaucracy and by our recalcitrant
partner in Peru. We are excited by the opportunities we have seen
in Southeast Asia and hope that we will be able to announce further
progress soon."
For further information on the Company, visit
www.baronoilplc.com or contact:
Baron Oil plc: Tel: +44 (0)1892
Malcom Butler (CEO) 838948
------------------------------------- -----------------
Cantor Fitzgerald (Nominated Advisor Tel: +44 (0)20
and Joint Broker) 7894 7000
Sarah Wharry (Corporate Finance)
Alex Pollen (Corporate Broking)
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SP Angel (Joint Broker) Tel: +44 (0)20
Richard Hail / Richard Redmayne 7470 0470
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The person making this notification on behalf of Baron Oil plc
is Geoff Barnes, the Chief Financial Officer and Director of the
Company.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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