25th Sep 2013 08:36
LONDON (Alliance News) - San Leon Energy PLC Wednesday said it has acquired 75% of Alpay Enerji A.S. and is to raise GBP31 million through share placing.
The European oil and gas producer said it has purchased 75% of Alpay Enerji and its seven conventional oil and gas licenses in Turkey for USD4 million.
The agreement also transfers nine additional Turkish licenses to Alpay, meaning that it will control 100% interests in 16 oil and gas licenses in Turkey.
San Leon expects that production from these 16 licenses can be increased to 10 million cubic feet per day of gas and 100 barrels of oil per day of oil by the end of the first quarter 2014, bringing a monthly revenue of roughly USD3 million.
In order to help fund the acquisition and development activity, San Leon also announced a GBP31 million placing to be carried out in two tranches.
The company said application has been made to AIM for the first placing, which is expected to be on September 30.
"The cash flow generated from the near-term development of Alpay Energy's assets is expected to make San Leon cash flow positive across the company's entire portfolio of assets by Q2 2014 and to deliver significant cash flow by Q4 2014," Executive Chairman Oisin Fanning said in a statement.
San Leon shares fell 4.00% to 5.28 pence in early trading Wednesday.
By Tom McIvor; [email protected]; @TomMcIvor1
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