25th May 2006 07:01
Ramco Energy PLC25 May 2006 Ramco Energy plc Litigation Update Ramco Energy plc ("Ramco" or the Company) Between December 2005 and February 2006 the Company announced, separately, thecompletion of the disposal of Ramco Oil Services Limited, the disposal of itsinterest in the Seven Heads Gas field and the resolution of related borrowingissues. Since February 2006, the Company has been attempting to accelerate itsforward exploration programme. The first step towards this objective wassecuring finance for its Irish exploration portfolio through the raising of newequity by its subsidiary, Lansdowne Oil & Gas plc ("Lansdowne"), and thesubsequent listing of Lansdowne on AIM, both of which were completed betweenFebruary and April 2006. The plaintiffs in the Company's long-running Texas litigation have taken stepsto enforce their judgement contemporaneously in both the Texas and Scottishcourts. The original judgement is currently the subject of an appeal in theTexas Court of Appeals (the "Appeal"). As previously announced, the plaintiffshave obtained orders requiring Ramco to turn over certain assets to the TexasState court, which Ramco has duly done. At the same time, on the applicationof the plaintiffs to the Scottish court, arrestments and inhibitions (which areforms of interim enforcement) have severely restricted the Company's ability toraise necessary additional working capital to enable Ramco to continue tooperate its business while prosecuting the Appeal. Yesterday, Ramco was unsuccessful in an attempt, in the Scottish court, toobtain some relief from the effect of the arrestments and inhibitions. TheCompany will now make an application to the Texas Court of Appeals, which heardthe case in April 2005, to expedite its decision on the grounds that any furtherdelay may result in the Company being unable to continue to trade. As a measure designed to allow the Company to raise some working capital, Ramcomay sell in an orderly manner a small proportion of the shares in Lansdownewhich are held with in the Ramco group. Ramco's directors recognise the importance of monitoring the financial positionof the Company on a continuous basis and, in the event that the measuresdescribed in this announcement prove insufficient, the directors may need toconsider an application for the appointment of an administrator. 25 May 2006 ENQUIRIES: Ramco Energy plcSteven Bertram Managing Director 01224 352 200 College Hill - LondonNick Elwes 020 7457 2020 Background Following a jury verdict in October 2003, the Texas State Court issued a finaljudgement in April 2004 against Ramco Energy plc and Ramco Oil Limited andcertain other defendants in a case alleging breach of contract arising fromconfidentiality and non-circumvention obligations. These obligations had beenundertaken while Ramco was considering investment in an oilfield developmentproject in Kazakhstan which Ramco subsequently did not pursue. The principal elements of the judgement issued by the trial judge in April 2004were an award against Ramco for past and future damages of $6.4 million plusinterest and legal fees of $9.8 million. The award of legal fees was madejointly and severally against Ramco and its co-defendant Halliburton. Theplaintiff subsequently agreed a settlement with Halliburton which has beendismissed from the case. The recent court orders and related proceedings arise from that judgementawarded in the Texas State Court. As reported in our interim results for 2005issued on 30 September 2005, the appeal and the plaintiff's cross-appeal, to theFourteenth Texas Court of Appeals were heard in Houston on 26 April 2005 and thecourt's decision is still awaited. This process may be followed by a furtherappeal by either party to the Texas Supreme Court. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Seascape Energy