REG - Borders & Southern - £2.5 million Fundraising

Borders and Southern PetroleumAnnouncement

30/11/2022 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20221130:nRSd9986Ha&default-theme=true

RNS Number : 9986H  Borders & Southern Petroleum plc  30 November 2022

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN, IS RESTRICTED AND IS
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN, INTO ANY MEMBER STATE OF THE EUROPEAN ECONOMIC AREA, THE
UNITED STATES (OR TO ANY U.S. PERSON), CANADA, JAPAN, AUSTRALIA, THE REPUBLIC
OF SOUTH AFRICA, OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A
VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION.

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS DEFINED IN ARTICLE 7 OF THE
MARKET ABUSE REGULATION EU NO. 596/2014, AS RETAINED AND APPLICABLE IN THE UK
PURSUANT TO SECTION 3 OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018, UPON THE
PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO
BE IN THE PUBLIC DOMAIN.

 

30 November 2022

 

Borders & Southern Petroleum plc

 

("Borders & Southern" or the "Company")

 

£2.5 million Fundraising

 

Borders & Southern (AIM: BOR), the London based independent oil and gas
exploration company with assets offshore the Falkland Islands, is pleased to
announce that it has raised £2.5 million, before expenses to advance studies
in its 100% Darwin Gas Condensate discovery. The fundraising comprises a Firm
Placing, using existing pre-emptive allotment authorities and a Conditional
Placing and a Conditional Subscription, both conditional on shareholder
approval to disapply pre-emption rights.

 

The fundraising will comprise, subject to the necessary shareholder approval
being granted, the issue, in aggregate of 142,857,138 is new ordinary shares
in the Company ("Ordinary Shares") at a price of 1.75 pence (the "Issue
Price") per new Ordinary Share (the "Fundraising"). The Issue Price is an
approximate 44 per cent. discount to the Company's closing price of 3.15 pence
on 30 November 2022.

 

Highlights of the Fundraising:

·   The Company is committed to advancing its 100% interest in its large Gas
Condensate discovery at its Darwin asset, which contains over 3.2 TCF GIP
(unrisked, Best Estimate) and 462 MMbbl of Liquids designated Contingent &
Prospective Resources (unrisked, Best Estimate), split across Darwin East
& West, and as independently assessed under the SPE PRMS Standard

·   Scoping project economics by Management suggest that a phased
development project with initial production of 26,000 bbl/d from Darwin East
could deliver NPV(10) of $4/bbl to $10/bbl dependent on oil price (range $60
to $90 per barrel).

·    £1.85 million raised through a firm placing of 105,714,281 Ordinary
Shares (the "Firm Placing Shares") at the Issue Price (the "Firm Placing")

·   £0.3 million raised through the conditional placing of 17,142,857
Ordinary Shares (the "Conditional Placing Shares") at the Issue Price (the
"Conditional Placing")

·    £0.35 million raised through the conditional subscription direct
with the Company by Harry Dobson, the Company's Non-Executive Chairman of
20,000,000 Ordinary Shares (the "Conditional Subscription Shares") at the
Issue Price (the "Conditional Subscription")

 

Use of Proceeds

 

The proceeds of the Fundraising will be used to fund the Company's Licence
fees, Discovery Area fees, technical and commercial studies, general &
administrative expenses and, more generally, to advance the Company's Darwin
project towards appraisal.

 

Howard Obee, Chief Executive Officer of Borders & Southern, commented:

 

"This Fundraising will allow us to advance further technical and commercial
studies for a potential appraisal and development of Darwin via a conventional
FPSO and phased development concept.

 

"This is a period of elevated world-wide energy prices and increasing global
E&P activity and Darwin is a large undeveloped discovery with attractive
scoping economics.  We look forward to reporting on the phased development
concept as our studies progress.

 

"We would like to thank existing shareholders and new investors for their
support in the Fundraising."

 

General Meeting

 

The Company is to utilise current allotment authorities to deliver the Firm
Placing. The Company requires further authorities to deliver the Conditional
Placing and the Conditional Subscription and a general meeting to provide
these authorities (the "General Meeting") will be held on or about 20 December
2022. A circular to convene the General Meeting will be circulated to
shareholders of the Company shortly. The General Meeting will propose
resolutions to shareholders to grant the board authority to allot each of the
Conditional Placing Shares and the Conditional Subscription Shares are on a
non-pre-emptive basis and to provide a further general authority on a
non-pre-emptive basis until the annual general meeting for the Company to be
held in 2023 to replace those authorities which will have been utilised by the
Firm Placing. Once published, the circular will be available to download from
the Company's website. It is important that shareholders lodge their votes in
advance of the General Meeting through submission of their proxy votes. A
further announcement will be made on publication of the Circular.

 

Director Participation and Related Party Transaction

 

Harry Dobson, the Company's Non-Executive Chairman, is the sole participant in
the Conditional Subscription, details on which are outlined below:

 

 Director      Position                Conditional Subscription Shares being subscribed for  Shareholding following Second Admission
 Harry Dobson  Non-Executive Chairman  20,000,000                                            81,372,000

 

Harry Dobson's existing shareholding in the Company, amounting to 10.44%, is
held by Zila Corporation. Mr Dobson is expected to have a result shareholding
percentage in the Company of 8.9% post-First Admission and 11.1% post-Second
Admission.

 

The participation in the Conditional Subscription by Harry Dobson is a related
party transaction for the purposes of AIM Rule 13 of the AIM Rules for
Companies due to Mr Dobson being a director of the Company, and a Substantial
Shareholder. The Directors of the Company independent of Mr Dobson consider,
having consulted with Strand Hanson Limited, the Company's Nominated Adviser,
that the terms of the Conditional Subscription are fair and reasonable in so
far insofar as the Company's shareholders are concerned.

 

Admissions and Total Voting Rights

 

Application has been made for admission of the Firm Placing Shares to trading
on AIM ("First Admission") and it is expected that First Admission will occur
on or around 6 December 2022. The Firm Placing Shares will rank pari passu
with the existing Ordinary Shares of 1 pence each in the capital of the
Company ("Ordinary Shares").

 

Following First Admission (of the Firm Placing Shares), the total issued share
capital of the Company will consist of 693,671,599 Ordinary Shares each with
voting rights. The Company does not hold any Ordinary Shares in treasury.
Therefore, the total number of voting rights in the Company will be
693,671,599 and this is the figure may be used by shareholders as the
denominator for the calculations by which they will determine if they are
required to notify their interest in, or a change in their interest in, the
share capital of the Company under the FCA's Disclosure Guidance and
Transparency Rules.

 

Application will be made for the Conditional Placing Shares and Conditional
Subscription Shares (together, the "Second Admission Shares"), to trading on
AIM following the requisite resolutions being passed at the General Meeting
("Second Admission") and it is expected that Second Admission will occur on or
around 21 December 2022.

 

 

For further information please visit www.bordersandsouthern.com
(http://www.bordersandsouthern.com/) or contact:

 

 Borders & Southern Petroleum plc

 Howard Obee, Chief Executive

 Tel: 020 7661 9348

 Strand Hanson Limited (Nominated Adviser)

 Ritchie Balmer / James Bellman

 Tel: 020 7409 3494

 SP Angel Corporate Finance LLP (Broker)

 Richard Hail / Stuart Gledhill / Adam Cowl

 Tel: 020 3470 0470

 Tavistock (Investor Relations)

 Simon Hudson / Nick Elwes

 Tel: 020 7920 3150

 

Notes:

 

Borders & Southern Petroleum plc is an oil & gas exploration company
listed on the London Stock Exchange AIM (BOR). The Company operates and has a
100% interest in three Production Licences in the South Falkland Basin
covering an area of nearly 10,000 square kilometres. The Company has acquired
2,517 square kilometres of 3D seismic and drilled two exploration wells,
making a significant gas condensate discovery with its first well.

 

-ends-

Glossary

 

 bbl                    barrel
 Best Estimate          With respect to resources categorization, the most realistic assessment of
                        recoverable quantities if only a single result were reported. If probabilistic
                        methods are used, there should be at least a 50% probability (P50) that the
                        quantities actually recovered will equal or exceed the best estimate.
 Condensate             A mixture of hydrocarbons (mainly pentanes and heavier) that exist in the
                        gaseous phase at original temperature and pressure of the reservoir, but when
                        produced, are in the liquid phase at surface pressure and temperature
                        conditions. Condensate differs from NGLs in two respects: (1) NGL is extracted
                        and recovered in gas plants rather than lease separators or other lease
                        facilities, and (2) NGL includes very light hydrocarbons (ethane, propane, or
                        butanes) as well as the pentanes-plus that are the main constituents of
                        condensate.
 Contingent Resources   Those quantities of petroleum estimated, as of a given date, to be potentially
                        recoverable from known accumulations by application of development projects,
                        but which are not currently considered to be commercially recoverable owing to
                        one or more contingencies.
 GIP                    The total quantity of gas that is estimated to exist originally in naturally
                        occurring reservoirs, as of a given date.
 MM                     million
 Liquids                A mixture of light hydrocarbons that exist in the gaseous phase in the
                        reservoir and

                        are recovered as liquids in gas processing plants. NGLs differ from condensate
                        in

                        two principal respects: (1) NGLs are extracted and recovered in gas plants
                        rather

                        than lease separators or other lease facilities, and (2) NGLs include very
                        light

                        hydrocarbons (ethane, propane, or butanes) as well as the pentanes-plus that
                        are

                        the main constituents of condensates.
 Prospective Resources  Those quantities of petroleum estimated, as of a given date, to be potentially
                        recoverable from undiscovered accumulations by application of future
                        development projects.
 TCF                    Trillion cubic feet
 NPV(10)                Net present value of estimated future net cash flows discounted at a 10%
                        interest rate
 SPE                    Society of Petroleum Engineers
 SPE PRMS Standard      The Petroleum Resources Management System (PRMS) is a system developed for
                        consistent and reliable definition, classification, and estimation of
                        hydrocarbon resources. The Oil and Gas Reserves Committee has completed the
                        revision of the Petroleum Resources Management System (PRMS) and the SPE Board
                        approved it in June 2018.

 

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  MSCBKCBKKBDBKDB