Agriterra Ltd Acknowledgment of £11,372,682 Compensation Award (0645E)
May 25 2012 - 2:00AM
UK Regulatory
TIDMAGTA
RNS Number : 0645E
Agriterra Ltd
25 May 2012
Agriterra Ltd / Ticker: AGTA / Index: AIM / Sector:
Agriculture
25 May 2012
Agriterra Ltd ('Agriterra' or 'the Company')
Acknowledgment of GBP11,372,682 Compensation Award to
Agriterra
Agriterra Ltd, the AIM listed pan African agricultural company,
is pleased to announce that following its instigation of
international arbitration proceedings, the Ministry of Petroleum
and Mining of the Republic of South Sudan ('the MPM') has
acknowledged in writing the Company's entitlement to receive a
compensation payment, as assessed by the country's National
Petroleum Commission ('NPC'), of GBP11,372,682 ('the
Compensation'). In the same communication, the MPM acknowledged
that compensation should have been paid much earlier and has
confirmed that it will be paid to the Company within one year.
The Compensation is acknowledged as being partial recompense for
the work undertaken and the substantial investment made by the
Company on the Block Ba oil concession area in Southern Sudan,
during its previous incarnation as White Nile Limited ('White
Nile'), an oil and gas exploration company. White Nile commenced
exploration work on Block Ba in 2005 and continued exploratory
activities prior to the NPC's decision to prohibit exploration work
in the area, in June 2007.
Whilst this recent communication from the MPM is a positive
development in the Company's efforts to achieve a resolution to
this long running matter, and arises from the Board's initiation of
international arbitration proceedings, the Company has now called
for a meeting with the relevant authorities in the Republic of
South Sudan in an effort to expedite payment of the
Compensation.
The Company also retains, as a legacy asset, a 20% interest in
the South Omo block in Ethiopia, which London listed Tullow Oil plc
('Tullow') and Africa Oil Corp have farmed into the development of.
Initial results announced by Tullow following drilling in Block
10BB in Kenya, which houses the same petroleum system as South Omo,
have been highly positive, increasing the prospectivity of the
South Omo Block. Should a discovery be made on the South Omo block,
Agriterra's 20% interest could prove to be significant for the
Company's shareholders and Agriterra looks forward to future
announcements from Tullow regarding this concession.
Agriterra CEO Andrew Groves said, "Our legacy oil assets are
continuing to look extremely promising, with the South Omo block
prominent in Tullow and Africa Oil east African exploration plans.
An GBP11 million cash payment from the South Sudanese, represents
approximately 30% of our current market capitalisation and further
enhances our already strong balance sheet on a non dilutive
basis."
** ENDS **
For further information please visit www.agriterra-ltd.com or
contact:
Andrew Groves Agriterra Ltd Tel: +44 (0) 20 7408
9200
Jonathan Wright Seymour Pierce Ltd Tel: +44 (0) 20 7107
8000
David Foreman Seymour Pierce Ltd Tel: +44 (0) 20 7107
8000
Andy Cuthill MC Peat & Co LLP Tel: +44 (0) 20 7104
2332
Susie Geliher St Brides Media & Finance Tel: +44 (0) 20 7236
Ltd 1177
Notes
Agriterra Ltd is an AIM listed agricultural company with four
divisions: beef, maize, cocoa and palm oil. Its cattle ranching
business, Mozbife, currently has a 4,000 strong herd, a land
holding of over 16,250 hectares, a feedlot and a 4,000 head per
month abattoir which is under construction. In addition to selling
meat from its own herds, throughput for the feedlot and abattoir
will be supplemented using cattle bought in from local
communities.
The Company's maize buying and milling operations, DECA and
Compagri, are located in Chimoio and Tete in central and
north-western Mozambique respectively. These collect maize from
circa 350,000 farmers using the Company's own vehicle fleet,
process it into mealie meal, the African staple, and then sell it
back to the local market, into supermarkets and to the World Food
Programme. Combined sales for the year ended 31 May 2011 totalled
28,822 tonnes maize meal generating revenue of US$13.6 million.
Agriterra's cocoa business is based in Sierra Leone, through its
100% subsidiary Tropical Farms Limited, which is currently a buying
and trading operation, but provides an ideal conduit to branch out
into cocoa production in West Africa. Its strategy is to establish
itself as a secure, sustainable and traceable source of supply to
meet the requirements of the major cocoa consumers who are placing
increased emphasis in this area.
The Company has expanded its portfolio of agricultural products
through the addition of palm oil, and holds a lease over
approximately 45,000 hectares of brownfield agricultural land in an
area suitable for palm oil production in the Pujehun District in
the Southern Province of Sierra Leone. This area of Sierra Leone,
which is close to the Liberian border, receives one the highest
levels of rainfall in Sierra Leone, which in itself, receives some
of the highest rainfall globally. In addition, the lease area is
located on the equatorial belt, which is the most favourable
geographical location for palm oil production.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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