17th May 2007 08:17
Island Oil and Gas PLC17 May 2007 17 May 2007 ISLAND OIL & GAS PLC EQUITY PLACING AND DEBT FUNDING Island Oil & Gas plc ("Island" or the "Company") today announces that theCompany's joint brokers, J&E Davy ("Davy") and Bridgewell Limited("Bridgewell"), are in the process of finalising a placing to fund the cost ofthe drilling programme, which commenced with the spudding of well 49/23-2 onExploration Licence 4/05 (the Old Head of Kinsale) in the Celtic Sea, offshoreIreland on 16 May 2007. The placing of new ordinary shares (the "Placing Shares") is being arranged withnew and existing institutional investors at a price of Stg£0.39 per PlacingShare to raise gross proceeds of not less than Stg£12.5 million (the "Placing").The Placing Shares will rank pari passu in all respects with the Company'sexisting issued Ordinary Shares. Investors subscribing for shares under the Placing will be entitled to 1 newwarrant for every 4 Placing Shares subscribed for, at an exercise price ofStg£0.45 per Ordinary Share. ("New Warrants"). The New Warrants will expire on16 July 2007. The implementation of the Placing, which is not underwritten, is conditional,inter alia, on Davy, Bridgewell and the Company entering into a placingagreement (the "Placing Agreement"); on a warrant instrument being executed; andon admission of the Placing Shares to trading on the AIM market of the LondonStock Exchange. In addition to the Placing described above, the Company has entered intodiscussions with RMB Resources ("RMBR") with the intention of refinancing theexisting short term loan facility of Stg£7.5 million arranged by RMBR with alarger secured, medium term debt facility to provide sufficient finance for theCompany's drilling and other activities in 2007 and into 2008. Further detailsof the new debt facility will be provided once it is finalised. Enquiries: Paul GriffithsChief ExecutiveIsland Oil & Gas plcTel: +353 1 631 3755 Lisa J Newman MCIPR MIRSNewman ConsultingTel: +44 (0)1252 878682 Anthony FarrellDavy+ 353 1 679 6363 Andrew MatharuBridgewell Limited+ 44 (0) 207 003 3105 Notes to editors: Island was founded in 2003 and listed on AIM in December 2004 (LSE:IOG). TheCompany has interests in eleven Irish offshore licences, as well as licences inthe Netherlands and Morocco. Island is involved in an exploration andappraisal programme which in 2006 saw successful Celtic Sea gas wells at the OldHead of Kinsale and the Seven Heads Sub-Area. The Company has again secured thePetrolia rig for its 2007 Celtic Sea drilling programme. This commenced in thesecond quarter of 2007 with an appraisal well at the Old Head of Kinsale gasfield, which is to be followed by an appraisal well at the Schull gas field. Licence Interests, Old Head of Kinsale - Island operator with 65%*; EnCore 15%(*with option to acquire an additional 5%); Valhalla Oil and Gas Limited 20%. Licence Interests, Schull gas field - The current interests in the Schull gasfield are: Island 62.5%; EnCore Oil plc 12.5%*; Valhalla 25%. * EnCore is alsogranted an option to acquire an additional 7.5% interest, subject to certainconditions. Further information on Island can be found on the Company's website at http://www.islandoilandgas.com. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
IOG.L