REG - Canadian O'Seas Petr - Announces Closing of $2.5m Financing

Canadian Overseas PetroleumAnnouncement

16/01/2024 07:00

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RNS Number : 7679Z  Canadian Overseas Petroleum Ltd  16 January 2024

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RELEASE, PUBLICATION OR DISTRIBUTION WOULD BREACH ANY APPLICABLE LAW OR
REGULATION.

COPL Announces Closing of $2.5m Financing

 

London, United Kingdom; Calgary, Canada: January 16, 2024 - Canadian Overseas
Petroleum Limited and its affiliates ("COPL" or the "Company") (XOP: CSE)
& (COPL: LSE), an international oil and gas exploration, production and
development company with production and development operations focused in
Converse and Natrona counties, Wyoming, USA, announces completion on January
15, 2024, of the critical $2.5 million equity financing providing the Company
with short-term working capital.

Financing Highlights

·    1,312,232,633 common shares of no par value have been issued to the
Company's leading equity and convertible bond investor Anavio Capital Partners
LLP ("Anavio").

·    On closing of the financing, Anavio will hold 24.5% of COPL's issued
and outstanding share capital.

·    The Company will also grant Anavio 1,312,232,633 common share
purchase warrants to be exercisable at £0.0015 per common share, expiring
August 26, 2028.

·    The Company's existing convertible bonds and warrants have been
amended in accordance with the announcement on December 29, 2023.

The Company had urgent liquidity needs and secured the $2.5 million of equity
financing, on the same terms previously disclosed on December 29, 2023, to
provide short-term working capital to:

·    Retain an independent E&P technical consultant in the United
States. The consultant is currently evaluating field operations and future
development plans.

·    Appoint a Chief Restructuring Officer, including a team of
restructuring professionals and financial advisor; and,

·    Maintain the Company's LSE & CSE public listings while the
Company works with the senior lender and professional advisors to determine
the best path forward for all the Company's stakeholders.

The Company is also exploring ways to allow shareholders and other investors
the chance to participate in an equity placing. The Company remains in a
precarious financial situation with very limited liquidity. As previously
announced, the forbearance agreement with the Senior Lender expires on
February 29, 2024 and there can be no assurance that it will be extended or
that the conditions of default will be remedied or waived.

UK - DTR & LR14

 

Following the issuance of the 1,312,232,633 common shares the Company will
have a total of 2,656,603,131 common shares issued and outstanding. There are
no common shares held in treasury and therefore the total number of voting
rights in the Company from that date is 2,656,603,131. This 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
Financial Conduct Authority's Disclosure Guidance and Transparency Rules.

 

Applications will be made for the common shares to be admitted to the FCA's
Official List and to trading on the London Stock Exchange's main market for
listed securities within the next twelve months, in accordance with Listing
Rule 14.3.4.

 

M.I. 61-101

The Company had also determined that the financing was a "related party
transaction" pursuant to Multilateral Instrument 61-101 - Protection of
Minority Security Holders in Special Transactions ("MI 61-101") and is exempt
from the formal valuation and minority approval requirements applicable to
related party transactions defined under MI 61-101 pursuant to the financial
hardship exemption under sections 5.5(g) and 5.7(1)(e) of MI 61-101.

The Company relied on the above exemptions on the basis that: (i) as described
in the Company's announcements of December 20, 2023, December 29, 2023 and
January 10, 2024 and January 12, 2024, the Company is in serious financial
difficulty and without the financing, it would not have sufficient working
capital for its present requirements, (ii) the financing was designed to
improve the financial position of the Company, (iii) the transaction was not
subject to court approval or court order, (iv) the Board and all independent
directors, each of the foregoing acting in good faith, determined that (i) and
(ii) above applied and that the terms of the financing were reasonable in the
circumstances to the Company, and (v) as at the date hereof, and with the
granting of certain exemptions by the Canadian Securities Exchange there is no
other requirement to hold a meeting to obtain the approval of the shareholders
of the Company for the financing.

 

About the Company:

COPL is an international oil and gas exploration, development and production
company actively pursuing opportunities in the United States with operations
in Wyoming.

 

For further information, please contact:

Mr. Tom Richardson, Chairman

Mr. Ryan Gaffney, CFO

Canadian Overseas Petroleum Limited

Tel: + 1 (403) 262 5441

 

Cathy Hume

CHF Investor Relations

Tel: +1 (416) 868 1079 ext. 251

Email: cathy@chfir.com (mailto:cathy@chfir.com)

 

Charles Goodwin

Yellow Jersey PR Limited

Email: copl@yellowjerseypr.com (mailto:copl@yellowjerseypr.com)

 

Neil Passmore / Mario Doerflinger

Financial Advisor/Joint Broker

Hannam & Partners

+44 (0) 20 7907 8500

Email: njp@hannam.partners (mailto:njp@hannam.partners) / md@hannam.partners
(mailto:md@hannam.partners)

Peter Krens

Joint Broker

Equity Capital Markets, Tennyson Securities

Tel: +44 (0) 20 7186 9033

 

The Common Shares are listed under the symbol "XOP" on the CSE and under the
symbol "COPL" on the London Stock Exchange.

All $ figures are United States Dollars unless otherwise noted.

Market Abuse Regulation disclosure

The information contained within this Announcement is deemed by the Company to
constitute inside information pursuant to Article 7 of EU Regulation 596/2014
as it forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 as amended ("MAR") encompassing information relating to
the Financing described above, and is disclosed in accordance with the
Company's obligations under Article 17 of MAR. In addition, market soundings
(as defined in MAR) were taken in respect of the Financing with the result
that certain persons became aware of inside information (as defined in MAR),
as permitted by MAR. This inside information is set out in this Announcement.
Therefore, upon publication of this Announcement, those persons that received
such inside information in a market sounding are no longer in possession of
such inside information relating to the Company and its securities.

Caution regarding forward looking statements

This news release contains forward-looking statements. The use of any of the
words "initial, "scheduled", "can", "will", "prior to", "estimate",
"anticipate", "believe", "should", "forecast", "future", "continue", "may",
"expect", and similar expressions are intended to identify forward-looking
statements. The forward-looking statements contained herein are based on
certain key expectations and assumptions made by the Company, including, but
not limited to, the ability to raise the necessary funding for operations,
delays or changes in plans with respect to exploration or development projects
or capital expenditures. Although the Company believes that the expectations
and assumptions on which the forward-looking statements are based are
reasonable, undue reliance should not be placed on the forward-looking
statements since the Company can give no assurance that they will prove to be
correct since forward-looking statements address future events and conditions,
by their very nature they involve inherent risks and uncertainties most of
which are beyond the control of Canadian Overseas Petroleum Ltd. For example,
the uncertainty of reserve estimates, the uncertainty that the Financing will
complete the uncertainty of estimates and projections relating to production,
cost overruns, health and safety issues, political and environmental risks,
commodity price, interest rate and exchange rate fluctuations, changes in
legislation affecting the oil and gas industry could cause actual results to
vary materially from those expressed or implied by the forward-looking
information.  Forward-looking statements contained in this news release are
made as of the date hereof and Canadian Overseas Petroleum Ltd. undertakes no
obligation to update publicly or revise any forward-looking statements or
information, whether as a result of new information, future events or
otherwise, unless so required by applicable securities laws.

Hannam & Partners, which is a member of the London Stock Exchange, is
authorised and regulated in the United Kingdom by the FCA is acting as joint
broker in connection with the Financing. Alternative Resource Capital, a
trading name of Shard Capital Partners LLP, and Tennyson Securities, each
authorised and regulated in the United Kingdom by the FCA are acting as joint
broker in connection with the Financing. Each of Hannam & Partners,
Alternative Resource Capital and Tennyson Securities are acting exclusively
for the Company in connection with the matters referred to in this
Announcement and for no-one else and will not be responsible to anyone other
than the Company for providing the protections afforded to their respective
clients, nor for providing any advice in relation to the contents of this
Announcement or any transaction, arrangement or matter referred to herein.

This Announcement has been issued by and is the sole responsibility of the
Company. No representation or warranty, express or implied, is or will be made
as to, or in relation to, and no responsibility or liability is or will be
accepted (apart from the responsibilities or liabilities that may be imposed
by the Financial Services and Markets Act 2000, or the regulatory regime
established thereunder) the Company or by any of their respective affiliates
or agents as to, or in relation to, the accuracy or completeness of this
Announcement or any other written or oral information made available to or
publicly available to any interested party or its advisers, and any liability
therefore is expressly disclaimed.

 

 

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