Zhaikmunai completes US$300m

RNS Number : 0558Z

Zhaikmunai LP

15 September 2009

 



  NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY IN OR into AUSTRALIA, CANADA, JAPAN OR THE UNITED STATES

ZHAIKMUNAI L.P.

Zhaikmunai completes US$300 million Placing of GDRs

London, 15 September 2009: Zhaikmunai L.P. (LSE:ZKM) ('Zhaikmunai'), the oil and gas exploration, development and production business based in northwestern Kazakhstan, today announces the successful completion of a US$300 million Placing through the sale of 75,000,000 new common units (the 'Placing') in the form of global depositary receipts ('GDRs'). Following admission of the GDRs to the Official List of the UK Financial Services Authority, trading of the GDRs on the main market of the London Stock Exchange commences today.  

The completion of the Placing is an important step forward in Zhaikmunai's plans for development of the Chinarevskoye field in Kazakhstan and follows the receipt of all necessary regulatory approvals from the Kazakh authorities. In conjunction with the Placing Zhaikmunai's existing loan facility has been amended and all outstanding defaults under the facility have been  cured or waived as provided in an amendment agreement signed with BNP Paribas. 

Commenting on the successful capital raising, Frank Monstrey, Chairman of Zhaikmunai, said:

'We are very pleased with the success of the Placing and the level of demand for the new units. The Placing helps put Zhaikmunai's financing on a firm and secure footing and was integral to the company's expansion plans. The support for the Placing also reflects investor confidence in Zhaikmunai's ability to deliver growth despite the current difficult economic environment. 

Zhaikmunai is an ambitious business with high potential, as demonstrated by the very substantial reserves contained in the Chinarevskoye field. This capital injection will allow us to tap that potential and continue to implement the company's growth strategy.'

Between September 2004 and January, 2009, Zhaikmunai invested approximately US$550 million in drilling and field infrastructure while crude oil production has increased from 205,784 bbl in the third quarter of 2004 to 683,883 bbl in the first quarter of 2009 and 1,326,980 bbls in the first half of the year. Zhaikmunai's estimated gross proven plus probable hydrocarbon reserves have increased from 215 million boe in 2004 to 529 million boe in 2008. 

Zhaikmunai's operational facilities consist of 32 existing wells including two exploration wells under drilling and an oil processing facility capable of processing 400,000 tonnes per annum of crude oil. Zhaikmunai began commercial production on 1 January 2007 and the completion of the Gas Treatment Facility currently under construction will be the next step in company's growth.  

The company's total capital expenditure to the end of 2018 is estimated to be approximately US$1.8 billion, including approximately US$971 million on new drilling and well workovers, US$569 million on the Gas Treatment Facility and US$15 million on the gas pipeline. The proceeds of the Placing will supplement the Group's existing credit facilities and fund in part the capital expenditure programme for the Chinarevskoye field.

Commenting on the announcement, Kai-Uwe Kessel, Chief Executive, said:

'Zhaikmunai has consistently delivered on all of its commitments under the Production Sharing Agreement with the Kazakh government and has continuously invested in the infrastructure of the Chinarevskoye field over the past few years. Those investments have now started to bear fruit but oil and gas exploration and production is a capital intensive business and the additional investments made possible by the Placing will be necessary to further exploit the potential of the area. The Placing not only demonstrates investor support, but will also enable us to continue to develop our business. We are pleased to see the company in a stronger position to deliver its stated growth strategy.'

The Placing was managed by ING, Mirabaud Securities, Renaissance Capital and First Energy.

Further enquiries  

Zhaikmunai     [e-mail]  

Brunswick      [phone]          

Michael Harrison

Natalia Erikssen

About Zhaikmunai  

Zhaikmunai L.P. is a limited partnership engaged in oil and gas exploration, development and production that is quoted on the London Stock Exchange PLC (Ticker symbol: ZKM). Its principal producing asset is the Chinarevskoye Field located in northwestern Kazakhstan.  

Zhaikmunai L.L.P., a wholly-owned subsidiary of Zhaikmunai L.P., holds a 100% interest in and is the operator of the Production Sharing Agreement for the Chinarevskoye Field.  

www.zhaikmunai.com  

Forward-Looking Statements:  

Some of the statements in this document are forward-looking. Forward-looking statements include statements regarding the intent, belief and current expectations of Zhaikmunai or its officers with respect to various matters. When used in this document, the words 'expects,' 'believes,' 'anticipates,' 'plans,' 'may,' 'will,' 'should' and similar expressions, and the negatives thereof, are intended to identify forward-looking statements. Such statements are not promises or guarantees, and are subject to risks and uncertainties that could cause actual outcomes to differ materially from those suggested by any such statements.

This announcement is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended. Zhaikmunai has not registered and does not intend to register any portion of the Placing in the United States, and Zhaikmunai does not intend to make any public offering of securities in the United States.

This announcement and any Placing mentioned herein if made subsequently are only addressed to and directed at persons in member states of the European Economic Area who are 'qualified investors' within the meaning of Article 2(1)(e) of the Prospectus Directive (Directive 2003/71/EC) ('Qualified Investors'). In addition, this announcement is for distribution in the united kingdom only to (i) investment professionals falling within article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the 'Order') or (ii) high net worth entities and other persons to whom it may lawfully be communicated, falling within article 49(2)(a) to (d) of the Order (all such persons together being referred to as 'relevant persons'). This announcement is directed only at relevant persons and it is not intended to be distributed, directly or indirectly, to any other person in the United Kingdom. Any person who is not a relevant person should not act or rely on this announcement or any of its contents. Any investment or investment activity to which this communication relates is available only to relevant persons and will be engaged in only with relevant persons. Other persons should not act or rely on this document or any of its contents.

Neither this announcement nor any copy of it may be taken or transmitted into the United States, Australia, Canada or Japan or to a resident, national or citizen of the United States, Australia, Canada or Japan. This announcement does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to purchase nor shall it (or any part of it) or the fact of its distribution, form the basis of, or be relied on in connection with, any contract therefor. The Placing and the distribution of this announcement and other information in connection with the Placing in certain jurisdictions may be restricted by law and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

Common Units in Zhaikmunai have not been and will not be registered under the applicable securities laws of Australia, Canada or Japan and, subject to certain exceptions, may not be offered or sold within Australia, Canada or Japan or to, or for the account or benefit of, citizens or residents of Australia, Canada or Japan except under circumstances which will result in the full compliance with the applicable laws and regulations promulgated by the relevant regulatory authorities in effect at the relevant time. 

ING Bank NV, FirstEnergy Capital Corp., Mirabaud Securities LLP and Renaissance Securities (Cyprus) Limited are acting exclusively for Zhaikmunai and no one else in connection with the offering. They will not regard any other person (whether or not a recipient of this announcement) as their respective clients and will not be responsible to anyone other than Zhaikmunai for providing the protections afforded to their respective clients nor for giving advice in relation to the Placing and, the contents of this announcement or any transaction or arrangement referred to herein.

 

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