27th Nov 2007 07:01
Andes Energia PLC27 November 2007 ANDES ENERGIA PLC ("Andes Energia" or "the Company") OPTIONS SIGNED TO ACQUIRE OIL & GAS PRODUCING ASSETS Andes Energia (AiM:AEN), the Latin American energy group, is pleased to announcethat it has signed two option agreements to acquire, subject to satisfactorycompletion of due diligence, further oil and gas assets. The first option is toacquire a 50% interest in a producing oil field in the province of Mendoza("Vega Grande") and the second option is to acquire a 20% interest in two blocksin the province of Neuquen, the major gas producing basin in Argentina("Corralera & Mata Mora"). If exercised, these options will significantlybolster the Company's oil and gas assets. Importantly, if the Vega Grande optionis exercised, it will be Andes Energia's first producing oil asset and theCorralera block has an existing discovery well. 1. VEGA GRANDE HIGHLIGHTS • Option to acquire a 50% interest in a producing oil field • Andes Energia has paid an initial amount of US$1.3m in cash to secure the option, which will be refunded if the option is not exercised • A further payment of US$9.2m will be payable in cash upon exercise of the option with possible further consideration payable in Andes Energia shares depending on the level of reserves discovered • If exercised, this will be Andes Energia's first producing oil field and will extend its oil and gas assets into the Mendoza province • If exercised, the final owners will be Andes Energia 50%, Petro Saudi Inc. 24% and Grecoil y Cia SRL 26% • Exercise of the option may constitute a related party transaction 2. CORRALERA & MATA MORA HIGHLIGHTS • Option to acquire a 20% participation in two licence blocks • US$480,000 payable in cash upon exercise of the option • Investment commitment of Andes Energia expected to be approximately US$1.2 million over 3 years • Corralera has a discovery well, NQ PB X-3 • If exercised, the final owners will be Andes Energia 20%, Ketsal S.A 18% and Kilwer S.A. 62% Since re-admission to AiM in October, Andes Energia has acquired a controllinginterest in Hidroelectrica Ameghino S.A, a hydro power plant. The Company hasalso recently extended its option to acquire the remaining 50% of SODEMSA, whichhas a 51% controlling interest in EDEMSA, the main electricity distributioncompany in the province of Mendoza. Commenting on the signing of these options, Chief Executive Officer Luis AlvarezPoli said: "We are delighted with the fact that we have been able to identifyopportunities to grow our asset base at such a pace, in line with our statedbusiness strategy. Vega Grande will give us existing production in anunder-managed and under-exploited field, whilst Corralera & Mata will give usthe opportunity to enter the Neuquen province in blocks with tested production." Enquiries: Andes Energia plc T: 020 7495 5326 Luis Alvarez Poli, CEO Nigel Duxbury, Finance Director Arbuthnot Securities T: 020 7012 2000 James Steel Antonio Bossi Bishopsgate Communications T: 020 7562 3350Maxine BarnesNick Rome Notes to Editors Andes Energia is a Latin American energy group, with electricity distribution,hydro electric power and oil and gas interests in Argentina. The Company joinedAiM through a reverse take-over of Ragusa Capital plc. The Company's focus is onthe Argentinean energy sector, which it believes offers premium assets atundervalued prices. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
PGR.L