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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Urals EN. | LSE:UEN | London | Ordinary Share | CY0107130912 | ORD USD0.126 (DI) |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 35.00 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
RNS Number:5705T Urals Energy Public Company Limited 03 November 2005 FOR IMMEDIATE RELEASE 3 November 2005 Urals Energy Public Company Limited Proposed Acquisition to boost Group's production by c.50% Urals Energy Public Company Limited ("Urals Energy" or the "Group") today announces that it has agreed to acquire production and exploration assets in the Komi Region of Russia for US$70 million, including assumed debt. Urals Energy is a leading independent exploration and production company with operations in Russia. Urals Energy's shares were admitted to trading on the London Alternative Investment Market in August 2005, with its IPO resulting in a total fund raising of US$131.1 million. Proposed Acquisition Urals Energy has today signed an agreement to acquire producing and exploration assets in the Komi Region of Russia for US$ 62 million cash plus the assumption of approximately US$ 8 million in debt; with closing of the transaction estimated for mid November. The transaction is subject to FAS (Russian Federal Antimonopoly service) approval and certain other customary conditions. Consideration for the acquisition will be satisfied through a combination of existing cash resources and debt, following completion of a new senior debt facility. This will have no material impact on the funding of the Group's existing development and exploration programme. Nevertheless, taking into account market conditions and likely future funding requirements, the Group may consider further equity issuance in due course. The proposed acquisition gives Urals Energy immediate incremental production of approximately 2,900 bopd and extensive exploration acreage in an area where the Group already has a complementary asset base. On completion in mid November it is expected that total group production will rise to c.8,700 bopd. Management estimates this acquisition will add proved reserves of approximately 12 million barrels and probable reserves of approximately 10 million barrels for total 2P additions of at least 22 million barrels. The Group is currently working with its independent engineering consultants, DeGolyer and MacNaughton, to confirm these estimated reserves. The proposed acquisition has an exploration and production license for an area of 960 square kilometres. A recently acquired 3D seismic survey indicates five exploration prospects that are analogous to the existing producing structure. The acquisition fits Urals Energy's acquisition criteria of acquiring producing assets in complementary areas of Russia and the CIS with development and exploration potential. On completion of the transaction the Group intends to actively develop these assets in order to increase production of the acquired assets from the current level of 2,900 bopd to 4,500 bopd by the end of 2006. 35% of the acquired assets' current production is exported with the 65% balance to the domestic market. The producing fields are connected by a pipeline to Transneft. Oil quality is light with a gravity of 36 API. The Group believes the transaction represents a compelling opportunity to acquire producing assets on attractive terms per 2P barrel in the Komi region, a region where the Group already has a complementary asset base and which the Group has identified as a core area to develop a material presence. There is also the potential to significantly increase reserves through development and exploration. The assets complement Urals Energy's existing asset base and operating experience in the Komi region and gives the Group the opportunity to reduce unit costs through economies of scale. This proposed transaction follows Urals Energy's acquisition of CNPSEI in October 2004 which gave the Group its initial presence in the Komi region. For the six months ended June 2005 CNPSEI achieved average daily production of 1,015 BOPD. More detailed information will be published following closing of the transaction. This will include information about the profitability of the acquired assets, prepared in accordance with the Company's accounting standards, following a reconciliation from the existing information which has been prepared in accordance with Russian Accounting Standards. William R. Thomas, Chief Executive Officer, commented: "This proposed transaction fits all our key objectives; it boosts production and earnings on day one, has material development and exploration potential and builds our presence in one of our core operational areas; enabling us to add value through new investment and reducing existing unit costs." 3 November 2005 Pelham PR James Henderson 020 7743 6673 Charles Vivian 020 7743 6672 About the company: Urals Energy is an independent exploration and production (E&P) company with its principal assets and operations in Sakhalin Island, Timan Pechora (including areas in the Nenets Autonomous Okrug and Komi Republic) and the Republic of Udmurtia, Russia. The company listed on AIM in August 2005. The Company is focused on the integration of its five recently acquired subsidiaries and the exploitation of their assets. In addition, it is actively seeking to continue to grow and diversify its reserve and production portfolio through exploration activities and the acquisition of additional E&P companies or assets by taking advantage of the ongoing rationalisation of E&P assets in Russia. The Company's five E&P subsidiaries have Proved and Probable reserves of 89.7 million barrels of oil equivalent (MMBOE) and produced approximately 5,600 barrels of oil per day (BOPD) during the first six months of 2005. The Company's two largest subsidiaries by reserves and production, Petrosakh and Arcticneft, own and operate refining assets with a total refining capacity of 5,300 BOPD, which provide the Company with the ability to maximise the value of the oil produced by choosing between the sale of oil or of refined products depending on market conditions, tax considerations and other factors. This information is provided by RNS The company news service from the London Stock Exchange END ACQDGMGMMZNGKZZ
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