TIDMROSE
RNS Number : 8339V
Rose Petroleum PLC
11 April 2019
Prior to publication, the information contained within this
announcement was deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulations (EU)
No. 596/2014 ("MAR"). With the publication of this announcement,
this information is now considered to be in the public domain.
11 April 2019
Rose Petroleum plc
("Rose", the "Company" or the "Group")
Issue of equity, Board Changes and appointment of Joint Broker
and Adviser
Further to its recent announcement on 28 March 2019, Rose
Petroleum plc (AIM: ROSE), the AIM-quoted natural resources
business, provides a further update on the Company's funding plan
and Board composition.
Highlights
-- GBP275,000 raised, before expenses, through a direct
subscription with the Company for 25,000,000 ordinary shares in the
Company (the "Fundraise");
-- Robert Bensh, an experienced Chairman with extensive
experience of onshore US oil & gas, has joined the Board in the
capacity of Executive Chairman and to support the Company has
subscribed for all of the Fundraise shares;
-- Tom Reynolds will also join the Board, as Non-Executive Director; and
-- David Sefton and James Berwick will no longer be joining the Board.
Fundraise
Rose has raised GBP275,000, before expenses, via a subscription
by Robert Bensh for 25,000,000 new ordinary shares (the "New
Ordinary Shares") at a price of 1.1 pence per share. The New
Ordinary Shares have been issued using the Company's existing share
authorities and will rank pari-passu with the existing ordinary
shares of 0.1p each in the Company ("Ordinary Shares").
The proceeds of the Fundraise will be used for general corporate
purposes including the appraisal of identified investment
opportunities within the Company's current portfolio of business
development projects.
Settlement of the Fundraise is expected to take place in the
next two weeks. Once the funds have been received by the Company,
application will be made to the London Stock Exchange for the New
Ordinary Shares to be admitted to trading on AIM ("Admission"). A
further announcement will be made at the appropriate time.
Following Admission, Robert Bensh will have an interest in
25,000,000 Ordinary Shares, equivalent to 14.84% of the Company's
enlarged issued share capital.
The Board of the Company has been notified that it is the
intention of certain Directors and Management of the Company to
place orders to purchase in aggregate GBP75,000 worth of Ordinary
Shares of the Company in the open market.
Directorate changes
On 28 March 2019, the Company announced that David Sefton and
James Berwick had agreed to join the Board following being proposed
by a group of shareholders. The Company has subsequently been
informed by Mr Sefton and Mr Berwick that they are no longer
seeking to join the Board.
As a result, the Company has continued to implement its plan to
strengthen the Board through the appointment of new directors and
is pleased to announce the appointment of Robert Bensh to the Board
as Executive Chairman, with immediate effect. In addition, Tom
Reynolds will also join the Board as a Non-Executive Director,
subject to completion of the regulatory due diligence process.
Robert Bensh is an international energy executive with over 20
years of senior management and board level experience. Mr Bensh has
significant capital markets experience both in London and North
America and is based in the US. His experience will assist Rose as
it develops its existing assets and looks at complementary
opportunities.
Amongst other senior executive roles previously held, Mr Bensh
led and financed Oklahoma-based Condor Exploration, transforming it
into a 1,000 boepd, 14 MMboe of reserves and US$145million of PV
oil and gas operation in just two and half years. He has previously
worked in Ukraine and Eastern Europe, as well as South America and
in the Mid-continent United States shale plays. Prior to this, he
was Chairman and CEO of NCNRG, a Mississippi Lime and Hunton
focused business that grew from 50,000 acres and 3 employees to
5,000 bopd of production before its sale to private equity
investors. Before this he was again Chairman and CEO of AIM traded
Cardinal Resources plc, an independent oil and gas company with
operations in Ukraine, before its sale for US$72million in
2007.
Mr Reynolds has been working with the Company for the past six
months on a consultancy basis and has a detailed knowledge of the
Group's operations. He is a Chartered Engineer with over 25 years'
experience in the energy sector, including a range of technical and
commercial roles with BP plc, Total SA and British Nuclear Fuels
plc. He has also held management positions at private equity
investment and advisory firms, including 3i plc, and specialises in
strategic planning, investment management and cross-border M&A
transaction execution in the oil, gas, energy and infrastructure
sectors.
Mr Reynolds has held board seats on various companies listed in
London, Oslo and Toronto. He is a non-executive director of AIM
listed Solo Oil plc. He was previously CEO of Iona Energy Inc. and,
immediately prior to that, he was CEO of Bridge Energy ASA, which
Mr Reynolds grew through a series of acquisitions before listing
the group in both Oslo and London, prior to its c.US$150m sale to
HitechVision-backed Spike Exploration Holding AS in 2013.
The Company has previously notified of Philip Jeffcock and Kelly
Scott's intentions to step down from the Board. Philip Jeffcock has
now stepped down from the Board with immediate effect and Kelly
Scott will step down upon the appointment of Mr Reynolds to the
Board. Following this, Kelly Scott will continue in his executive
role with the Company in a non-Board capacity. The Board is
extremely grateful to both of them for their work during this
challenging period.
Additional appointments to the Board are being considered, both
executive and non-executive, and the Company will make further
announcements at the appropriate time.
Outlook
Rose continues to engage with prospective farm-in partners for
its Gunnison Valley property in Utah, USA, as well as screening
other opportunities which offer a route to establishing cash
generative production in the near term. With interim funding now in
place and with the assistance of the new Board members and
advisers, the Company will continue to work on identifying the
optimal path to deliver shareholder value and will provide an
update to shareholders in due course.
The Company has, amongst others, identified one such potential
project in Texas, USA, which it believes could offer the potential
for rapid production. The project is to drill a side track well off
an existing vertical well with relatively low drilling costs. Rose
has engaged an independent petroleum engineer to assess the project
and the associated risks. The Directors believe the project could
produce at an Initial Production rate of 350bopd, which would imply
payback within approximately six months. The Company has developed
an excellent working arrangement with the owner/operator who has
access to a number of other similar projects which have the
potential to act as a pipeline of projects for the Company to build
production in the near-term. For the avoidance of doubt the Company
does not currently have a binding agreement over this project.
Total Voting Rights
The Fundraise is conditional, among other things, upon Admission
becoming effective. Following Admission, the issued share capital
of the Company will comprise 168,413,940 Ordinary Shares with one
voting right per share.
The Company does not hold any shares in treasury. Therefore,
following Admission, the total number of Ordinary Shares and voting
rights in the Company will be 168,413,940. The above figure may be
used by shareholders in the Company as the denominator for the
calculations by which they will determine if they are required to
notify their interest in, or a change to their interest in, the
share capital of the Company under the FCA's Disclosure Guidance
and Transparency Rules.
Appointment of Joint Broker and Adviser
The Company is pleased to announce that it has appointed Novum
Securities as Joint Broker with immediate effect. Turner Pope
Investments and Cantor Fitzgerald Europe will remain as
Co-Brokers.
The Company is pleased to announce it has appointed Gneiss
Energy Limited ("Gneiss") as its commercial and strategic advisor.
Gneiss is a specialist corporate advisory boutique with extensive
energy sector M&A experience. Gneiss has been appointed to
assist the Board with the Company's existing asset portfolio
alongside delivering a sustainable and growth focused asset
operation.
Regulatory Disclosures
Further information on Robert Bensh as required to be disclosed
in accordance with Schedule 2 (g) of the AIM Rules for
Companies:
Robert ("Rob") Joseph Bensh (formerly Robert Joseph), aged 51,
is or has been a director of the following companies or
partnerships in the past five years:
Past directorships/partnerships
Current directorships/partnerships (within the past 5 years)
* 44 Bensh Media Holdings LLC * Kub-Gaz LLC (also known as Kub-Gas LLC)
* Red Bensh Fork Energy LLC * Gastek LLC
* Altore Inc * Taurex Resources Plc (formerly known as Cardinal
Resources Plc)*
* Benes Advisors LLC
* TV2U International Limited (formerly known as Cossack
Energy Limited)
* Pelicourt Limited
* Westeros Holdings Ltd
* Chama Energy Inc
* Leadville Resources Partners LLC
* Mr Bensh was appointed a director of Cardinal Resources Plc
(later renamed Taurex Resources Plc) on 19 February 2004. On 27
October 2009 petition was filed and on 1 February 2010 winding up
of the company commenced. The company was in compulsory liquidation
until 15 January 2015 and it was subsequently dissolved on 23 April
2015.
Matthew Idiens, CEO, Rose Petroleum plc, said: "I am delighted
to welcome Rob Bensh as Executive Chairman and believe that his
outstanding regional and operational expertise will be of great
value to Rose as we look to optimise our portfolio and unlock
additional opportunities in the upcoming months.
"Tom has been working with Rose on a consulting basis for the
past six months and I am pleased he has agreed to join the Board to
extend the capacity in which he can assist. I would also like to
take this opportunity to thank Philip and Kelly for their service
to Rose and wish each well for future endeavours."
Contacts:
Tel: +44 (0)20 7225
Rose Petroleum plc 4595
Matthew Idiens (CEO) Tel: +44 (0)20 7225
Chris Eadie (CFO) 4599
Allenby Capital Limited - AIM Nominated Adviser
Jeremy Porter / James Reeve / Liz Kirchner Tel: +44 (0)20 3328
5656
Cantor Fitzgerald Europe - Financial Adviser
and Joint Broker Tel: +44 (0)131 257
Nick Tulloch 4634
David Porter Tel: +44 (0)20 7894
7686
Novum Securities Limited - Joint Broker
Colin Rowbury Tel: +44 (0)20 7399
9427
Turner Pope Investments - Joint Broker
Andy Thacker Tel: +44 (0)20 3621
4120
Media enquiries:
Allerton Communications Tel: +44 (0) 20 3633 1731
Peter Cunliffe peter.cunliffe@allertoncomms.co.uk
Notes to editors
Rose Petroleum plc (http://rosepetroleum.com) is a North
America-focused oil and gas company whose primary asset is
approximately 80,000 net acres in the prolific oil and gas
producing Paradox Basin in Utah, U.S.A., where it is earning into a
75% working interest. Using high-quality data gathered in a 3D
seismic survey completed in October 2017, the Company has
identified drilling locations in naturally fractured areas of the
Paradox Formation and has chosen the first well location and it is
now permitted to drill and plans to commence the drilling programme
and the first well as soon as possible, subject to rig
availability, stipulations of the leases, BLM Unit obligations and
financing.
On 22 June 2018, Rose announced a Competent Person's Report
("CPR") and Maiden Contingent Resource by Gaffney Cline &
Associates ("GCA") on the Rose acreage covered by the 3D seismic,
approximately 17,250 acres of the 80,000 acres held. The CPR
estimated a 2C Contingent Resource, net to Rose, of 9.25 MMBbl of
oil and 18.50 Bscf of gas, and an unrisked pre-tax Net Present
Value (NPV10) on the 2C Resources, net to Rose, of US$122 million.
The CPR focused solely on one single reservoir - the Cane Creek
reservoir (the "CCR" or "Clastic 21") - of the multiple prospective
reservoirs within the Paradox Formation.
The Company's established management is supported by an expert
technical team with extensive experience of the basin, where
current operations nearby have proven successful, with significant
initial production rates and low decline rates, offering strong
economics even in the present oil price environment.
The Company's strategy is to grow both organically and through
acquisition, identifying additional hydrocarbon assets,
conventional or unconventional, that would benefit from the
Company's fast-acting, entrepreneurial approach.
Rose Petroleum has been quoted on AIM since June 2004.
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END
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