Ocelot to sell Canadian properties
Ocelot Energy Inc OCE.B
Shares issued 27,731,860 Mar 29 close $2.25
Tue 30 Mar 99 News Release
Mr. W. David Lyons reports:
Ocelot Energy Inc. announces that it has agreed to sell the shares of a
subsidiary holding all of its remaining Canadian production to a client of
NAL Resources Management Limited for $126-million in cash. A definitive
purchase and sale agreement has been signed, with closing scheduled for May
7, 1999. The purchaser has tendered a $10-million non-refundable deposit to
secure the transaction and Ocelot has entered into a lockup agreement with
a $10-million breakup fee. Ocelot shareholders will vote on the transaction
at the company's annual and special meeting of shareholders on May 7, 1999.
After retiring all bank debt, Ocelot plans to redeploy the capital into its
portfolio of high impact international energy projects.
To date, Ocelot has assembled one of the highest quality portfolios of
international oil and gas development projects put together by a Canadian
independent. Production from the Obangue reservoir in Gabon was initiated
in 1998 and is expected to increase through year-end 1999; a development
well is planned in Kazakhstan early in the year 2000; natural gas
production in Tanzania is scheduled to commence production by the end of
2001; while Ocelot's natural gas-to-electricity project in Cameroon is
expected to come on stream in 2002.
Commenting on the transaction, Ocelot's chief executive officer, David
Lyons, said: "This transaction is the next step in the strategic
repositioning of Ocelot. The process was initiated in 1995 and has
generated almost $300-million in proceeds from dispositions since that
time. Ocelot is now ideally positioned to add value on a very low cost
basis for the foreseeable future. With cash in hand, and several hundred
million barrels of high quality energy reserves to develop from four
international projects over the next several years, Ocelot's future looks
especially bright."
Ocelot's Canadian production, which is involved in this transaction, is
focused in the Sylvan Lake and Sturgeon Lake areas of Alberta with
production of 6,000 barrels of oil equivalent per day in 1998. Proven
reserves total 21.9 million barrels of oil equivalent. The assets are held
by an Ocelot subsidiary, which has $24-million in tax pools. Had the
transaction occurred on an asset basis, Ocelot anticipates that the
acquisition price would have yielded approximately $150-million, or $25,000
per barrel of oil equivalent in the company's estimation.
At the annual and special meeting of shareholders scheduled for May 7,
1999, the shareholders will be asked to approve the sale transaction, a
corporate name change to Ocelot International Ltd. and the continuation of
the company under the laws of Bermuda. J.V. Lyons has entered into an
agreement to cause approximately 55 per cent of all of the outstanding
votes attached to Ocelot shares to be voted in favour of the special
resolution approving the sale. |
