Urals Energy Public Company Limited Update on strategy and trading (2770X)
07 Février 2013 - 8:00AM
UK Regulatory
TIDMUEN
RNS Number : 2770X
Urals Energy Public Company Limited
07 February 2013
Press Release 7 February 2013
Urals Energy PCL
("Urals Energy" or the "Company")
Update on strategy and trading
Urals Energy PCL (AIM:UEN), the independent exploration and
production company with operations in Russia, is pleased to provide
the following update on strategy and trading.
Resolution of legacy issues
As previously reported on 7 December 2012, the Company has paid
the final loan principal amount to Petraco Oil Company Limited
("Petraco"). The only sum that remains outstanding to Petraco
relate to interest and totals approximately US$3.0 million. This
remaining interest payment is anticipated to be made before the end
of 2013 and is linked to the timing of the next tanker shipment
from Arcticneft. Petraco have released the security pledge they
held over the Company's Petrosakh asset and the Board are in
discussions with Petraco about them releasing their security pledge
over Articneft. However, since the release of the pledge is linked
to the full discharge of all debts due to Petraco, there can be no
guarantee that Petraco will agree to release the pledge earlier
than contractually required.
The Board is satisfied with the conclusion of the arbitration
against a former director, Vyatcheslav Rovneiko, relating to the
repayment of a loan totaling US$3.7 million made by the Company to
Mr Rovneiko in 2007. This arbitration has confirmed the Company's
legal rights, vindicated its position and issued a final award that
the sum in the amount of US$7.5 million (including loan amount,
interest and legal costs) must be repaid to Urals Energy together
with a daily accumulating interest. The Company has formally
demanded payment from Mr Rovneiko and is committed to using all
appropriate means to collect the outstanding amount.
Having achieved a satisfactory resolution of these past issues
the Board is now able to fully focus on the Company's operations
and growth opportunities.
Current operations
Petrosakh
Current production at Petrosakh is 1,440 BOPD. In the competent
persons report dated 31 December 2007, by DeGolyer and MacNaughton,
the Company had 2P reserves standing at 16 MMbbl and 3P at 20.6
MMbbl. Production between 2008 and 2012 was 3 MMbbl. The Company is
currently developing a drilling programme for Petrosakh and plans
to drill up to two new wells in 2013, subject to receipt of the
necessary Russian regulatory approvals.
Arcticneft
Production is stable and stands at 712 BOPD. In the competent
persons report dated 31 December 2007, by DeGolyer and MacNaughton,
the Company had 2P reserves at 43.6 MMbbl and 3P at 64.1 MMbbl.
Production between 2008 and 2012 was 1.3 MMbbl. The Company has
entered into a contract to carry out a passive seismic study for
the identification of potential hydrocarbon pools with Geodynamics
Worldwide Srl. The technology will be utilised with the aim of
increasing the efficiency of drilling via detailed interpretation
of hydrocarbons within a specific area. The results are expected to
be finalised by summer 2013 and the Board anticipates one new well
being drilled at Articneft in 2013.
Trading update
The Board anticipates that the Company's results for the year
ended 31 December 2012 will be in line with market
expectations.
Outlook
The Board are committed to delivering maximum value to
shareholders through the effective management of the Company's
existing assets, as well as through new assets. In the short-term
the Company will undertake drilling activity at Petrosakh and
ArcticNeft. Possible additional wells maybe drilled in the future,
based on success of the planned 2013 drilling programme. The aim of
further drilling is to increase production at both sites.
In addition to the Company's existing operations, the Board
continues to look for additional revenue streams. This maybe
through: identifying ways of utilising the upside potential in
downstream and marketing opportunities at the Company's existing
assets; and, evaluating possible acquisitions and joint venture
targets. The Board's medium-term strategy is to expand and optimise
the Company's portfolio and build a steady cash flow.
An overview presentation is available from the Urals Energy
website and can be downloaded at
www.uralsenergy.com/ir_presentations.htm.
Commenting on the update, Andrew Shrager, Non-Executive Chairman
of Urals Energy, said: "With the majority of the Company's legacy
issues now resolved, Urals Energy enters into 2013 with renewed
optimism for executing its strategic plan. This includes further
strengthening of our balance sheet, primarily by increasing output
at both Petrosakh and Arcticneft, and also, by looking at possible
M&A opportunities. The Company is now entering a key period in
its corporate development as the Board seeks to create maximum
value for shareholders."
- Ends -
For further information, please contact:
Urals Energy Public Company Limited
Alexei Maximov, Chief Executive Tel: +7 495 795 0300
Officer
Sergey Uzornikov, Chief Financial www.uralsenergy.com
Officer
Allenby Capital Limited
Nominated Adviser and Broker
Nick Naylor Tel: +44 (0) 20 3328
5656
Alex Price www.allenbycapital.com
Media enquiries:
Abchurch
Henry Harrison-Topham / Quincy Allan Tel: +44 (0) 20 7398
7702
henry.ht@abchurch-group.com www.abchurch-group.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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