REG - Southern Energy Corp - OPERATIONS UPDATE & SHARE CONSOLIDATION

Southern EnergyAnnouncement

10/12/2021 07:00

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RNS Number : 2061V  Southern Energy Corp.  10 December 2021

SOUTHERN ENERGY CORP. ANNOUNCES

OPERATIONS UPDATE & SHARE CONSOLIDATION

 

Calgary, Alberta - December 10, 2021 - Southern Energy Corp. ("Southern" or
the "Company") (SOU: TSXV) (AIM: SOUC), a U.S.-focused, growth-oriented
natural gas producer, is pleased to announce an update with respect to
drilling and operations, and that it will be proceeding with the consolidation
of the common shares of the Company (the "Common Shares") previously approved
by shareholders of the Company on July 7, 2021.

Drilling and Operations Update

Southern Energy Operating LLC, an operating subsidiary of Southern, has
contracted Energy Drilling Company's Rig #15 (the "Rig") for the upcoming
drilling program at its Gwinville asset in central Mississippi. Southern has
received drilling permits for three horizontal wells (GH 19-3 No. 2, GH 19-3
No. 3, and GH 19-3 No. 4) targeting natural gas in the Selma Chalk Formation
which will be drilled from a single surface pad location. The Rig is expected
to move to location in late December 2021 after finishing the well it is
currently drilling for another operator.

Ian Atkinson, President & Chief Executive Officer, commented

"We are delighted to initiate the Gwinville drilling program prior to year-end
and to partner with Energy Drilling Company from Natchez, Mississippi, who
have successfully drilled similar horizontal Selma Chalk wells in the past. We
expect the results of this drilling to have a meaningful impact on the Company
as we bring on the new production volumes and incremental cash flow prior to
the end of Q1 2022. The Gwinville 19-3 surface pad is ready for the drilling
rig and its location within Company-owned infrastructure allows us to bring on
new production from these wells onstream quickly. This is the beginning of
what we believe will be long-term growth at Gwinville providing value for our
investors."

Common Share Consolidation

At the annual general and special meeting of shareholders of the Company held
on July 7, 2021 (the "Meeting"), a special resolution was passed authorizing
and approving the directors of Southern to consolidate the Common Shares. On
December 9, 2021, the Company's board of directors approved the consolidation
of the Common Shares on the basis of one post-consolidation Common Share for
every eight pre-consolidation Common Shares (the "Consolidation"). The board
of directors intends to effect the Consolidation to increase the Company's
flexibility and competitiveness in the marketplace and make the Company's
securities more attractive to a wider audience of potential investors, thereby
resulting in a more efficient market for its Common Shares.

The Consolidation will be effective upon the filing of the Articles of
Amendment for the Company, and remains subject to the approval of the TSX
Venture Exchange (the "TSX-V"). Trading of the Common Shares on a
post-Consolidation basis on the TSX-V and AIM is expected to commence on or
about December 22, 2021. The record date for the Consolidation will take place
on the close of business of the last trading day immediately prior to the date
on which the post-Consolidation Common Shares commence trading on the TSX-V.

 

The 616,901,068 Common Shares currently issued and outstanding will be reduced
to approximately 77,122,634 Common Shares on a post-Consolidation basis. No
fractional shares will be issued. Any fractional interest in Common Shares
that is less than 0.5 of a Common Share resulting from the Consolidation will
be rounded down to the nearest whole Common Share and any fractional interest
in Common Shares that is equal to or greater than 0.5 of a Common Share will
be rounded up to the nearest whole Common Share.

As a result of the Consolidation, there will be certain proportional
adjustments to outstanding options and warrants to acquire Common Shares to
preserve the rights of holders of such securities to the relevant proportion
of the Company's Common Shares post-Consolidation.

Letters of transmittal will be mailed to registered shareholders and
registered shareholders will be required to deposit their share
certificate(s), together with the duly completed letter of transmittal, with
Odyssey Trust Company, the Company's registrar and transfer agent.
Non-registered shareholders holding Common Share through an intermediary (a
securities broker, dealer, bank or financial institution) should be aware that
the intermediary may have different procedures for processing the
Consolidation than those that will be put in place by the Company for
registered shareholders. If shareholders hold their Common Shares through an
intermediary and they have questions in this regard, they are encouraged to
contact their intermediaries.

For more information on the Consolidation, shareholders are encouraged to
refer to the management information circular of the Company dated June 16,
2021, which is available on Southern's SEDAR profile at www.sedar.com
(http://www.sedar.com) .

For further information, please contact:

 

 Southern Energy Corp.

 Ian Atkinson (President and CEO)                           +1 587 287 5401

 Calvin Yau (VP Finance and CFO)                            +1 587 287 5402

 Strand Hanson Limited - Nominated & Financial Adviser      +44 (0) 20 7409 3494

 James Spinney / James Bellman

 Hannam & Partners - Joint Broker                           +44 (0) 20 7907 8500

 Samuel Merlin / Ernest Bell

 Canaccord Genuity - Joint Broker                           +44 (0) 20 7523 8000

 Henry Fitzgerald-O'Connor / James Asensio

 Camarco

 James Crothers, Billy Clegg, Daniel Sherwen                +44 (0) 20 3757 4980

About Southern Energy Corp.

Southern Energy Corp. is a natural gas exploration and production company.
Southern has a primary focus on acquiring and developing conventional natural
gas and light oil resources in the southeast Gulf States of Mississippi,
Louisiana, and East Texas. Our management team has a long and successful
history working together and have created significant shareholder value
through accretive acquisitions, optimization of existing oil and natural gas
fields and the utilization of re-development strategies utilizing horizontal
drilling and multi-staged fracture completion techniques.

Forward-Looking Information

 

Certain information included in this press release constitutes forward-looking
information under applicable securities legislation. Forward-looking
information typically contains statements with words such as "anticipate",
"believe", "expect", "plan", "intend", "estimate", "propose", "project" or
similar words suggesting future outcomes or statements regarding an outlook.
Forward-looking information in this press release may include, but is not
limited to, statements concerning the Consolidation, statements concerning the
drilling of three horizontal wells in the Selma Chalk Formation, and the
timing and success of such wells. The forward-looking statements contained in
this press release are based on certain key expectations and assumptions made
by Southern, including the timing of the receipt of the required regulatory
and third-party approvals relating to the Consolidation, the success of
Southern's planned drilling operations, production and timing of the Selma
Chalk wells, and expected benefits from the drilling of such rigs.

 

Although Southern 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 because 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. Actual results could differ materially from
those currently anticipated due to a number of factors and risks. These
include, but are not limited to, the risk that trading of the Common Shares on
a post-Consolidation basis may not take effect when expected, the Company's
ability to obtain and renew all relevant licenses and permits, the success of
the Company's drilling operations, and the Company's ability to complete its
drilling objectives in the timeframe stated above. Other risks faced by the
Company are set out in more detail in Southern's Annual Information Form for
the year ended December 31, 2020, which is available under the Company's SEDAR
profile at www.sedar.com (http://www.sedar.com) .

 

The forward-looking information contained in this press release is made as of
the date hereof and Southern undertakes no obligation to update publicly or
revise any forward-looking information, whether as a result of new
information, future events or otherwise, unless required by applicable
securities laws. The forward-looking information contained in this press
release is expressly qualified by this cautionary statement.

 

Neither TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of
the European Union (Withdrawal) Act 2018.

 

 

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