Shares in Sterling Energy plc started trading on the Alternative Investment Market this week as the company also announced the acquisition of new gas production in the Gulf of Mexico.
This week’s purchase of a 17.5% interest in the Galveston 303 license for a total consideration of $315,000 is adding instant revenues of around $50,000 per month at current gas prices, and is expected to pay for itself after less than a year. Substantial upside in wells that are currently not producing, and in un-drilled prospects, has been acquired “for free”.
Galveston 303 is currently producing 4,000 mfcd of gas, with potential to add 1,000 mcfd more at minimal expense. It may provide at least two new drilling opportunities for 2003.
Chief Executive Harry Wilson said, “We are delighted to be able to demonstrate so quickly to shareholders how we can use our management expertise to add value to the company at minimal financial risk.”
Acquisition and funding completed under experienced management team
The arrival of Sterling Energy plc on AIM comes after shareholders in AIM-quoted LEPCO plc approved the acquisition of privately-owned Sterling Energy Limited for up to £7.9m, payable in shares. They also approved a change of name for LEPCO to Sterling Energy plc, and the raising of additional working capital of £2.4 million through a placing and open offer.
Harry Wilson takes on the role of Chief Executive, with the addition of executive directors Nigel Quinton (Operations and Technical) and Graeme Thomson (Finance). Richard O’Toole is named as non-executive Chairman.
These directors have previous experience running independent oil and gas companies such as Kirkland Resources, Dragon Oil and Endeavour Oil and Gas. It is a proven management team that has worked together for over 15 years.
Further expansion of wide global portfolio
Sterling already has a portfolio of five cash-flow producing gas fields in the Gulf of Mexico. In addition, Sterling owns a 100% working interest in a large exploration license offshore Philippines, where some 600 bcfe of potential gas reserves were found in the 1970s and 1980s. Sterling is evaluating a potential development of these reserves through gas-to-liquids technology. Considerable upside drilling potential exists adjacent to the existing finds.
Mr Wilson added: “We intend to continue to acquire new assets, build a wider international portfolio of exploration and production interests, and offer the prospect of strong capital growth.”
For further information contact:
Harry Wilson, Chief Executive
Sterling Energy plc: 01582 462121
Graeme Thomson, Finance Director
Sterling Energy plc: 01582 462121
Allan Piper, First City Financial Public Relations: 020 7436 7486
Chris Callaway, Evolution Beeson Gregory: 020 7071 4324
