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Silvermere Energy (TERN)

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Friday 21 October, 2011

Silvermere Energy

Warrant Exercise, Placing and Director's Dealing

RNS Number : 5726Q
Silvermere Energy PLC
21 October 2011
 



21 October 2011

 

 

Silvermere Energy plc

("Silvermere" or "the Company")

 

Warrant Exercise, Placing and Director's Dealing

 

 

Warrant Exercise and Placing

 

Silvermere Energy Plc ("Silvermere" or "the Company"), the independent oil and gas company with assets in the USA, is pleased to announce that the Company has raised an aggregate of £150,000 from existing investors.

 

Of this, £75,000 has been raised via the conversion of 250,000 warrants at 30p by an existing investor, pursuant to an agreement with the Company dated and announced on 25 August 2011.

 

The Company has raised a further £75,000 through a placing of 468,750 shares at 16p per share with two existing investors. The additional placing was necessary because the vendors of the Mustang Asset ("Core Vendors") declined to honour their unconditional and irrevocable undertakings to exercise 250,000 warrants to the value of £75,000 pursuant to  agreements with the Company dated and announced on 25 August 2011 on the same terms as the agreement with the existing investor above. The Company is reviewing its legal options as well as continuing to try to persuade the Core Vendors to meet their obligations.

 

Director's Dealing

 

In support of the above, Andy Morrison, chief executive officer of Silvermere, has agreed to reinvest £9,600 of salary due to him through the exercise of 32,000 warrants at 30p per share. The ordinary shares arising from the warrant exercise will be held by Mr Morrison in his SIPP.

 

As a result of this warrant exercise, Andy Morrison's total shareholding in the Company amounts to 161,560 ordinary shares, representing 0.88 per cent of the Company's issued share capital as enlarged by the placing and warrant exercises detailed above.

 

Application will be made for the new ordinary shares to be issued pursuant to the above arrangements to be admitted ton trading on AIM and dealings are expected to commence on 27th October 2011.

 

Total Shares in Issue

 

Following the above share issues, the total number of ordinary shares in issue will be 18,354,191.   Shareholders may use this number when calculating their percentage holding in the Company.

 

Commenting on the above, Andy Morrison, chief executive of Silvermere Energy, stated:

 

"I am delighted that existing shareholders have demonstrated their faith in the underlying value of the Company's assets by joining me in converting warrants at 30p per share and making up the shortfall through an additional placing despite a difficult market. The Competent Person's Report on our assets published by RPS Energy in August 2011 valued our proven and probable reserves at £18.4 million (equivalent to approximately 100.2p per share, based on the Company's enlarged issued share capital) with a further £59.0 million (approximately 321.4p per share) of upside in our possible reserves.

 

Since Admission, at the end of August 2011, Silvermere has met with Dominion, the operator of the Company's Mustang Island asset, a number of times.  The relationship between the two companies is excellent.  Not only is the fabrication of the production platform advancing well with tie in of and first production from the I-1 Well still on track for 2011 but we are starting to collaborate together on the planning for the subsequent three well development programme in that field.  Accordingly, the Directors of Silvermere are confident about the prospects for further success on the Mustang Island block."

 

 

 

-ENDS-

 

 

 

For further information please contact:

 

Silvermere Energy plc

Andy Morrison, Chief Executive

 

 

 

 

+44 (0)7980 878561

 

Merchant Securities Limited (Nominated Adviser and Broker)

Lindsay Mair/Virginia Bull

 

Rivington Street Corporate Finance Limited

Jon Levinson/Dru Edmonstone

 

 

+ 44(0)20 7628 2200 

 

 

+44 (0)20 7562 3357

 

Bishopgate Communications

Nick Rome/Shabnam Bashir

 

+44(0)20 7562 3350

 

 

About Silvermere Energy Plc

 

The Company acquired its interest in the Mustang Asset on 30 August 2011.  This comprises a 33.33 per cent. working interest and 20.83 per cent. net entitlement interest in the Mustang Licence Area, an area within the southern half of the north west quarter and northern half of the south west quarter of the Block 818-L field as defined in State of Texas Oil and Gas Lease numbers 108873 and 108874. The Mustang Island 818-L field, located in Kleberg County waters of the Gulf of Mexico, is a field re-habilitation project targeting bypassed or only partially produced gas-condensate.

 

Early in 2011 the Hercules Offshore 205 jack-up rig was contracted to re-enter the I-1 Well on the Mustang Licence Area which was considered to be the most likely of the historic well sites to provide 14 optimum re-entry conditions. The I-1Well re-entry and side-tracking operation was completed in March 2011 leaving it ready to complete in sand horizons I-1 to I-6. Production and flow testing was carried out during June 2011. The well re-entry programme was led by Dominion as the operator. Gas and oil produced from the I-1Well is proposed to be connected to pipeline infrastructure and tied in via a subsea tree, constructed for the purpose and then transported to the Six Pigs gas facility.

 

Silvermere's strategy is to acquire a portfolio of US oil and gas licence interests onshore and in shallow offshore waters, characterised by relatively low risk and low cost with the potential for near term production.

 

Silvermere is quoted on the AIM Market of the London Stock Exchange plc (AIM: SLME) with its offices in London.

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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