Eytan Uliel of Challenger Energy explains the current fundraise and what the proceeds will be used for
Eytan Uliel, CEO of Challenger Energy #CEG explains how the current fundraise will allow completion of the Company's Financial Restructuring as well as providing funds for a low-risk development work programme in Trinidad and Tobago and Suriname in 2022 and into 2023.
The net proceeds of the Fundraising will allow completion of the Company's Financial Restructuring as well as providing funds for a low-risk development work programme in Trinidad and Tobago and Suriname in 2022 and into 2023. The proposed development programme is focused on increasing production and cash flow. In particular, the intended use of the net proceeds of the Fundraising includes:
· making remaining agreed payments that are due during 2022 in order to complete the final elements of the Financial Restructuring, thereby reducing the total balance sheet creditor / liability / exposure position of the Company from approximately US$23 million to approximately US$2.5 million;
· funding a production growth focused work programme in Trinidad and Tobago over the course of 2022 and 2023 that will include low-risk well recompletions and workovers, drilling of new infill production wells and the implementation of enhanced oil recovery (waterflood and CO2 injection) techniques, with the objective of increasing production from the current level of approximately 400 bopd to more than 1,000 bopd by 2024, and thus driving cash flow growth;
· undertaking an extended well test on the Company's Weg Naar Zee asset in Suriname, with the objective of demonstrating commerciality and subsequently moving that project into the development stage and onto production to deliver additional near-term cash flow generation; and
· providing general working capital, additional capital for incremental work programmes, and, should appropriate opportunities arise, pursuing business development or other inorganic production growth opportunities;
In support of the Financial Restructuring and recapitalisation of the Company, a number of changes to the Board and management team will take effect, conditional on completion of the Fundraising, including:
· Iain McKendrick will join the Board as Non-Executive Chairman, and William Schrader (current Non-Executive Chairman) and James Smith (current non-executive Deputy Chairman) will step down from the Board. Further, Simon Potter has indicated that he will step down from the Board within three months of completion of the Fundraising, thus allowing sufficient time for a suitable replacement non-executive Director to be identified and brought on board; and
· Tim Eastmond will be appointed as Chief Financial Officer of the Company and will join the Board as an Executive Director, and Gagan Khurana, the Company's current Commercial Manager, will assume the role of Chief Commercial Officer, while certain members of the Company's current executive team (including the COO and Finance Director) have already or will shortly cease employment with the Company.
About Challenger Energy
Challenger Energy is a Caribbean and Atlantic margin focused oil and gas company, with a range of production, development, appraisal and exploration assets and licences, located onshore in Trinidad and Tobago, and Suriname, and offshore in the waters of The Bahamas and Uruguay. In Trinidad and Tobago, Challenger Energy has five (5) producing fields, two (2) appraisal / development projects and a prospective exploration portfolio in the South West Peninsula. In Suriname, Challenger Energy has on onshore appraisal / development project.
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