Columbus Energy Resources Share Discussion Threads

[toploadermike] 08/10/2018 13:19

I agree with all said, great or at least better management choices with confidence, also suggests the 11th notifications will be a +.

Going to load up probably today or tomorrow.

Great to see.

[edgar222] 08/10/2018 12:50

Good question droftartsFor me, they planned the Lind facility knowing of this issue. Announced at same time. They did not know how cash and production would look. They are now more confident of both and have cleared this potential litigation in order to remain focussed on the production issue.So to me it smacks of confidence.

[droftarts] 08/10/2018 12:49

you're probably right as it will save future loan interest which may have been onerous.
I wonder why Steeldrum were disputing the loan?

"Steeldrum is currently in dispute with North Energy over the North Energy Loan and may be in default of the North Energy Loan."

[greatfull dead] 08/10/2018 12:45

toploadermike,

That too was my thought after reading the RNS and the start of the trading this a.m.

I anticipate a very good response to the forthcoming 10 0ctober RNS "Operations and Business Update for Q3 2018" and subsequent presentation by Leo Koot that evening.

ATB,
GD

[arrynillson] 08/10/2018 12:42

Carp - the debt was known about - the existing lender would almost certainly have included a clause allowing them to be repaid on a takeover or to agree terms with new owner - presumably LK decided that it better suited CERP interests to repay debt and have borrowing with Lind - a lender who CERP are comfortable with offering good terms - demonstrates the advantage of securing favourable deal in advance - gives CERP control of outcome.

[droftarts] 08/10/2018 12:42

I am confused,

"For the financial year ended 31 December 2017, the Steeldrum group had US$13.7 million in assets, US$8.36 million in equity, US$5.36 million in liabilities (including a US$1.25 million loan repayable in 2020)"

If the loan is not due until 2020 why draw down from the Lind facility now?

[smoggyg] 08/10/2018 12:29

Probably not a lot toploader imo,I reckon the important thing is the presentation on the 10th,if it is good we might see a lot of buying on the 11th but if it is mediocre or poor there could be a sell off then.

[toploadermike] 08/10/2018 12:11

Estimated impact from the shares on the 11th October anyone?

[carpadium] 08/10/2018 11:50

OK edgar222, have it your way chap but don't dispute the fact that there was little intention by LK of triggering the LIND loan facility so clearly it wasn't expected to have to meet Steeldrum's liability. And it doesn't change the fact that the deal is more expensive. And further I'm well aware of the benefits of this deal as I stated what a good acquisition this is. OK?

[edgar222] 08/10/2018 11:41

Carpadium

So your point is that Leo Koot missed the "cost" (ie. the debt you did not notice) during the negotiations and the sign off? Or forgot about it? Even though it is in the RNS? Piffle.

Given that CERP knew about this and told us about it there is no basis for you saying this is a "new" liability. It was clearly included in the original negotiations and is not "new".

[carpadium] 08/10/2018 11:37

edgar222, so what?

Just making the point that the original deal as announced cost $5.8m. It now has cost over $7m.

[edgar222] 08/10/2018 09:10

Carpadium said

"....none too pleased to see a third of the LIND 'insurance' money spent repaying a loan we didn't know existed. This should be repaid to shareholders by way of modifying the original deal terms...."



The reality is that the RNS announcement of the 13th July said this:

"For the financial year ended 31 December 2017, the Steeldrum group had US$13.7 million in assets, US$8.36 million in equity, US$5.36 million in liabilities (including a US$1.25 million loan repayable in 2020) and made a gross profit of US$0.83 million and net loss of US$1.96 million (after depreciation charges of US$1.56 million)."

[carpadium] 08/10/2018 08:38

Late riser today, none too pleased to see a third of the LIND 'insurance' money spent repaying a loan we didn't know existed. This should be repaid to shareholders by way of modifying the original deal terms. Also bit of a gamble buying two fields without Petrotrin's consent, particularly bearing in mind their future emphasis on own production. Still, overall a good acquisition and we're just about ahead of time so Columbus, get producing fast!

[smoggyg] 08/10/2018 08:02

Here is the Lind facility,note there will be no repayments for 120 days.//////On 12 July 2018, the Company therefore entered into a new short-term Convertible Security facility (the "Lind Facility") with Lind Asset Management VII, LLC ("Lind") which provides the Company with the right, but not the obligation, to drawdown up to US$3.25 million. The Lind Facility has been established to provide Columbus with access to additional funds, should they be required over the next six months, to support the Steeldrum transaction, including costs associated with integrating the two companies or accelerating certain operational activities. The consolidated group, post the Steeldrum transaction, is expected to be operationally cash flow positive. The Lind Facility allows Lind to convert any outstanding loans into equity at a share price of 8.1 pence per share.

In summary, the Lind Facility provides the Company with the following:

-- The right to drawdown funds as follows:
o up to US$2.25 million of convertible loans for a period of up to 180 days after execution of the Lind Facility (in two tranches of US$1.0 million and US$1.25 million);

o a further US$1.0 million of convertible loans, in tranches of US$0.5 million each, subject to mutual agreement with Lind and the Company having a minimum market cap of GBP25 million;

-- Should the Company not exercise its drawdown rights within the 180-day period, the agreement will lapse and no funds will be available;

-- After any first drawdown, there is a 120-day repayment free window before repayment of the loans over a 20-month period from free cashflow from the Company's current and new operations, or monthly repayments may alternatively be made in equity at the Company's election at the prevailing price at the time of payment;

-- In addition, Lind has received 5,472,136 share options, which they can exercise at a share price of 8.1 pence, and will receive additional options alongside any drawdowns on the same exercise terms. Lind also has the right to convert any loans outstanding into ordinary shares at a share price of 8.1 pence per share during the two-year period of the Lind Facility;

-- The Company has paid an up-front commitment fee of US$35,000 for the first US$1 million available for drawdown. Apart from legal fees incurred to establish the Lind Facility, no other payments have been made to Lind at this stage and no other payments are due if the Lind Facility was to lapse;

-- Following any drawdowns, the amounts drawn-down are secured against the assets of Columbus in a manner similar to the previous security agreements with Lind until fully repaid and carry a 0% interest rate, although there is a 8.5% face value uplift per annum on any loans drawndown.

[edgar222] 08/10/2018 08:01

If it is 1p per share per 100 BOPD then we are at 750-850BOPD now before the update on Goudron etc.

[offerman] 08/10/2018 08:01

I didn't know about this part ( so we instantly lose 1.25m$ to pay for steeldrum dispute...! I didn't know there was a disputed and it's a shame we have to pay for that . " The 2018 Lind Facility specifically contemplates the ability to draw down US$1.25 million (of the US$3.25 million) to repay a US$1.25 million loan taken out by Steeldrum with North Energy Capital AS ("North Energy" and "North Energy Loan"). Steeldrum is currently in dispute with North Energy over the North Energy Loan and may be in default of the North Energy Loan. The Company expects to resolve the dispute by repaying the North Energy loan by drawing down US$1.25 million from the 2018 Lind Facility. North Energy holds security over the shares in the company that owns the Innis-Trinity field ("Innis-Trinity Security") and also Talon (defined below). Upon repayment of the North Energy Loan, the Company expects the Innis-Trinity Security to be released. "

[smoggyg] 08/10/2018 07:17

At the time of announcing the Steeldrum transaction, the Company also announced the availability of a short-term Convertible Security facility (the "2018 Lind Facility"), which provides the Company with the right, but not the obligation, to drawdown up to US$3.25 million. The 2018 Lind Facility provides the Company with access to additional funds, should they be required, to support the Steeldrum transaction, including costs associated with integrating the two companies or accelerating certain operational activities. The 2018 Lind Facility specifically contemplates the ability to draw down US$1.25 million (of the US$3.25 million) to repay a US$1.25 million loan taken out by Steeldrum with North Energy Capital AS ("North Energy" and "North Energy Loan"). Steeldrum is currently in dispute with North Energy over the North Energy Loan and may be in default of the North Energy Loan. The Company expects to resolve the dispute by repaying the North Energy loan by drawing down US$1.25 million from the 2018 Lind Facility. North Energy holds security over the shares in the company that owns the Innis-Trinity field ("Innis-Trinity Security") and also Talon (defined below). Upon repayment of the North Energy Loan, the Company expects the Innis-Trinity Security to be released. Talon is not beneficially owned by the Columbus group. The Company has made no decisions as to whether it will drawdown any of the US$2.0 million remaining under the 2018 Lind Facility, once the above-mentioned US$1.25 million has been drawn-down for repayment of the North Energy Loan.////// Drawdown of $1.25m of Lind facility which could be paid out of cash income or shares. If Lind ask for shares then they will be at 8.1p a share,which is unlikely to be requested at the present share price If Cerp ask to pay in shares then shares will be issued at market prices.

[smoggyg] 08/10/2018 07:12

Consistent with the Company's announcement on 10 September 2018, the Company has issued 109,166,209 ordinary shares to the sellers of Steeldrum ("Sellers") to complete the acquisition (the "Steeldrum Completion Shares"). The shares issued comprise the consideration shares totalling 92,743,775 and 16,422,434 deferred consideration shares following the re-issue of the Cory Moruga E&P licence. The Steeldrum Completion Shares (equivalent to 16.8% of the current issued share capital) will rank pari passu in all respects with the Company's existing ordinary shares. Application has been made for the Steeldrum Completion Shares to be admitted to trading on AIM, ("Admission"), and it is expected that Admission will become effective and that dealings will commence on or around 11 October 2018. The Sellers are subject to certain lock-in arrangements that will prohibit them divesting the Steeldrum Completion Shares for a period of at least 6 months post completion, save for 10% of the base consideration shares.///// Only 10.9m shares not locked in for 6 months.

[smoggyg] 08/10/2018 07:09

RNS Number : 2027D

Columbus Energy Resources PLC

08 October 2018

8 October 2018

COLUMBUS ENERGY RESOURCES PLC

("Columbus" or the "Company")

Completion of acquisition of Steeldrum Oil Company Inc

Total Voting Rights

Columbus, the oil and gas producer and explorer focused on onshore Trinidad with the ambition to grow in South America, is pleased to announce the completion of the purchase of Steeldrum Oil Company Inc ("Steeldrum").

The Company also confirms that the quarterly Operations and Business Update for Q3 2018 will be reported via RNS on 10 October 2018, followed by a presentation by Columbus' Executive Chairman, Leo Koot, to shareholders and other stakeholders that evening, with drinks from 6.30pm and the presentation commencing at 7.00pm at Manicomio, 6 Gutter Lane, London EC2V 8AS.

Leo Koot, Executive Chairman of Columbus, commented:

"We are very pleased to have completed the acquisition of Steeldrum, which I believe will be a material step in the growth of Columbus and establish a very solid base for our Trinidad operations. The Company now has a large, well balanced portfolio of assets strung across the south and south-west of Trinidad. The portfolio includes low-risk but highly prospective exploration opportunities in the South West Peninsula ("SWP"), a development project in Cory Moruga and 5 producing oilfields (Goudron, Innis Trinity, South Erin, Bonasse and Icacos). This provides the Company with an excellent opportunity to exploit our existing and new assets through operational excellence and also grow organically through exploration and the Cory Moruga development project. We will now focus on growing production and revenues in Innis Trinity and South Erin through the adoption of a similar operational strategy to our existing fields.

We expect all integration issues associated with Steeldrum transaction to have been addressed by the end of Q4 2018.

As set out in our Interim Results on 27 September, the Company's objective is for production from Trinidad to exceed 1,000 bopd by the end of 2018 and the consolidated group, post the Steeldrum transaction, is expected to remain operationally cash flow positive.

We now officially welcome the Steeldrum oil and gas team into the larger Columbus group. The Steeldrum team are a well-respected oil and gas team, experienced in drilling wells in Trinidad, which is ideal for our expanded portfolio.

Additionally, as part of the transaction, we will have access (at preferential rates) to a drilling rig suitable for our planned exploration activities in the SWP and a production rig.

I am delighted to have completed this deal with Steeldrum and we are on track to building a core exploration, appraisal, development and production hub in the south and south-west of Trinidad."

Information on the Steeldrum transaction and the combined Columbus - Steeldrum group

Steeldrum is the parent company for the West Indian Energy Group Ltd and is the owner of the licences for the Innis-Trinity field (100% and operator), South Erin field (100% and operator) and the Cory Moruga development project (83.8% and operator), all located in southern Trinidad and close to Columbus's existing assets.

The Innis-Trinity field and South Erin field are currently producing approximately 150 barrels of oil per day ("bopd") and 100 bopd respectively, with remaining 2P reserves of approximately 4 million barrels of oil ("mmbbl") and 1.6 mmbbl respectively. The Cory Moruga development is expected to have recoverable reserves of approximately 1.1 mmbbl.

At the time of announcing the Steeldrum transaction, the Company also announced the availability of a short-term Convertible Security facility (the "2018 Lind Facility"), which provides the Company with the right, but not the obligation, to drawdown up to US$3.25 million. The 2018 Lind Facility provides the Company with access to additional funds, should they be required, to support the Steeldrum transaction, including costs associated with integrating the two companies or accelerating certain operational activities. The 2018 Lind Facility specifically contemplates the ability to draw down US$1.25 million (of the US$3.25 million) to repay a US$1.25 million loan taken out by Steeldrum with North Energy Capital AS ("North Energy" and "North Energy Loan"). Steeldrum is currently in dispute with North Energy over the North Energy Loan and may be in default of the North Energy Loan. The Company expects to resolve the dispute by repaying the North Energy loan by drawing down US$1.25 million from the 2018 Lind Facility. North Energy holds security over the shares in the company that owns the Innis-Trinity field ("Innis-Trinity Security") and also Talon (defined below). Upon repayment of the North Energy Loan, the Company expects the Innis-Trinity Security to be released. Talon is not beneficially owned by the Columbus group. The Company has made no decisions as to whether it will drawdown any of the US$2.0 million remaining under the 2018 Lind Facility, once the above-mentioned US$1.25 million has been drawn-down for repayment of the North Energy Loan.

The consolidated group, post the Steeldrum transaction, is expected to be operationally cash flow positive.

Completion of the Steeldrum transaction

Consistent with the Company's announcement on 10 September 2018, the Company has issued 109,166,209 ordinary shares to the sellers of Steeldrum ("Sellers") to complete the acquisition (the "Steeldrum Completion Shares"). The shares issued comprise the consideration shares totalling 92,743,775 and 16,422,434 deferred consideration shares following the re-issue of the Cory Moruga E&P licence. The Steeldrum Completion Shares (equivalent to 16.8% of the current issued share capital) will rank pari passu in all respects with the Company's existing ordinary shares. Application has been made for the Steeldrum Completion Shares to be admitted to trading on AIM, ("Admission"), and it is expected that Admission will become effective and that dealings will commence on or around 11 October 2018. The Sellers are subject to certain lock-in arrangements that will prohibit them divesting the Steeldrum Completion Shares for a period of at least 6 months post completion, save for 10% of the base consideration shares.

Steeldrum is also the parent company of Talon Well Services Ltd ("Talon"), which owns a drilling rig, suitable for the Company's planned exploration activities in the South West Peninsula, and a production rig located in Trinidad. The purchase of Talon is not part of the transaction and the parties have entered into an agreement to ring fence Talon within the Columbus group until such time as it can be legally carved out from the Columbus group. As part of the transaction, Talon has granted Columbus preferential rates for the use of its two rigs.

In completing the purchase of the Steeldrum, the Buyer (Columbus Energy (St Lucia) Limited) waived the requirement of Petrotrin's consent to the transaction ("Petrotrin's consent"). Petrotrin's consent applies to the Innis-Trinity Field IPSC and the South Erin Farmout Agreement. Pursuant to the terms of the relevant agreements, Petrotrin's consent is not required prior to completion. Columbus will continue to seek Petrotrin's consent post completion. There is a risk that Petrotrin may not consent to the Steeldrum transaction and seek to terminate the relevant agreement although the Company does not expect this to be the case and will continue to liaise with Petrotrin to seek its consent.

Steeldrum currently engages Gelco Energy Consultants to provide Managing Director services for the Steeldrum group. Post completion of the Steedrum transaction, the Company will continue with these arrangements on terms commensurate with the current Columbus management team. The combined Columbus - Steeldrum group will undertake the normal integration management post completion, with Stewart Ahmed continuing to lead the combined group's technical and operational activities.

Change of registered address

The Company notes that its registered office is now Suite 114, 90 Long Acre, London, WC2E 9RA. This move to a smaller London office is to manage our administrative cost in a prudent manner. There was no material cost associated with the move.

Total Voting Rights

For the purposes of the Disclosure and Transparency Rules of the Financial Conduct Authority, the Board of Columbus hereby notifies that as at the date of this announcement, and after the issuance of the Steeldrum Completion Shares, the Company's issued share capital consists of 759,452,621 ordinary shares with a nominal value of 0.05p each, with voting rights ("Ordinary Shares"). The Company does not hold any shares in Treasury. Therefore, the total number of Ordinary Shares in the Company with voting rights is 759,452,621. This figure may be used by shareholders in the Company as denominator for the calculations by which they may determine if they are required to notify their interest in, or change to their interest in, the Company under the Financial Conduct Authority's Disclosure Guidance and Transparency Rules.

Qualified Person's statement:

The information contained in this document has been reviewed and approved by Stewart Ahmed, Managing Director (Trinidad) for Columbus Energy Resources plc. Mr Ahmed has a BSc in Mining and Petroleum Engineering and is a member of the Society of Petroleum Engineers. Mr Ahmed has over 32 years of relevant experience in the oil industry.

This announcement is inside information for the purposes of Article 7 of Regulation 596/2014.

Contact Information


Columbus Energy Resources plc
Leo Koot / Gordon Stein [phone]
VSA Capital Limited
Financial Adviser and Broker
Andrew Monk / Andrew Raca / Justin McKeegan [phone]
Beaumont Cornish Limited
Nominated Adviser
Roland Cornish / Rosalind Hill Abrahams [phone]
Camarco
Public and Investor Relations
Georgia Edmonds / James Crothers [phone]

Notes to Editors:

Columbus Energy Resources Plc is an oil and gas producer and explorer focused on onshore Trinidad with the ambition to grow in South America. Initially focussed on maximising production from its core Goudron field asset, Columbus is cashflow positive and aims to create transformational growth by developing its exploration targets across its portfolio in the South West Peninsula ("SWP"), which lies in the extreme southwest of Trinidad and consists of stacked shallow and deep prospects, in a capital efficient and disciplined manner.

Columbus is guided by the following core values; safe and sustainable, stronger together, creative excellence, positive energy, totally trusted and personally responsible.

The Company is led by an experienced Board and senior management team with supportive shareholders and intends on leveraging its expertise and experience to build an attractive and diversified portfolio of assets across South America in order to build an oil production led South American exploration business.

To find out more, visit www.columbus-erp.com or follow us on Twitter @Columbus_ERP.

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 [e-mail] or visit www.rns.com.

END

[toploadermike] 08/10/2018 07:06

Great news today, can't wait to see what this stock does over the next week, the 10th will be interesting too...

[h van der h] 05/10/2018 13:17

i seem to remember reading that Goudron's light oil isn't suitable for full Co2 treatment but LK has indicated Huff and Puff recently, basically filling the well with Co2 and shuting it in to soak and loosen up surrounding area then put it back into production..

As for TI and prd predictions (somewhat optimistic imo), thats a win/win for us really.. half of what those wells produce after THEY have foot the bill for the process including infrastructure upgrades required, goes into CERP's bank account, prd can continue on that agreement going forward giving us a free benefit of 50% of potential production increase from any areas we supply them with or they will have to raise $4.2m minimum to buy TI from us.. the remaining untouched areas of TI remain solely CERP's until they buy FRAM!

[jcgswims] 05/10/2018 12:29

I had to press play a few times on the link to get it to work, maybe its an intermittent problem their end.

[offerman] 05/10/2018 12:18

I should've said can access linkThe iPhone changed it to can't

[offerman] 05/10/2018 12:18

Hi JCG I can't get that to work I can't access the link but I can't get the play button to work no matter what I do try different networks refresh cache allsorts

[offerman] 05/10/2018 11:58

Yes , I'mHoping to go