Corporate Update,Equity Issue

RNS Number:6799N
Equator Exploration Limited
11 February 2008


FOR IMMEDIATE RELEASE - 11 February 2008

FOR: EQUATOR EXPLORATION LIMITED
("Equator" or "the Company")

SUBJECT: Corporate Update and Issue of Equity to raise $700,000

London, 11 February 2008 - Equator makes the following announcement to provide a
corporate update and also details on the raising of US$700,000 in addition to
the US$1,172,160 announced on Friday 8 February 2008.

Farm-out status

The Company confirms that it has obtained the approval of other parties to the
Joint Operating Agreement for the assignment of a 20% interest in the deep water
block OPL323 to BG Exploration and Production (Nigeria) Limited. The Company has
made submission to Nigerian National Petroleum Corporation ("NNPC") for its
approval, which once received will allow the farm-out to be completed shortly
thereafter.

Expressions of interest have been received from a number of parties wishing to
participate in the Company's interest in its other deep water block in Nigerian
territorial waters, OPL321.

In addition, the Company is in preliminary discussions with international oil
companies regarding collaboration on its rights over two blocks in the Exclusive
Economic Zone in Sao Tome e Principe.

Further announcements will follow in due course.

Financing

As noted above, the Company has not yet received approval from NNPC for the
farm-out of a portion of the Company's interest in OPL323. In order to provide
the Company with additional flexibility and liquidity, the interest on the US$65
million loan dated 3 August 2006, totalling US$4.1 million and due to be paid in
February 2008, has been deferred with the agreement of the lenders, until
completion of the farm-out of OPL323. In consideration for this deferral, the
Company has agreed that the 17,397,353 warrants issued to the lenders should be
re-priced to �0.30 per share from �0.40 per share, with all other terms
remaining unaltered.

Further, in a separate transaction, the terms of the US$7.5 million loan from
Ingalls & Snyder Value Partners LP dated 2 July 2007 have been amended. In
consideration for the lender agreeing to exercise immediately 5,000,000 of the
10,989,000 warrants granted by the Company, which could have been exercised over
2 years, the Company has agreed to a reduction in the exercise price of the
warrants to be immediately exercised, from �0.35 per share to US$0.14 per share
(equivalent to �0.071 at current exchange rates). Following a request to
exercise the warrants, the Company will issue 5,000,000 common shares in the
Company (the "Shares") for a purchase price of US$700,000. The proceeds will be
used for general working capital purposes. Application will be made for the
Shares, which will rank pari passu with existing ordinary shares, to be admitted
to trading on AIM. The effect is therefore to raise money by the issue of Shares
at the current share price, thus eliminating those warrants.

Peak Petroleum Industries Nigeria Limited ("Peak")

On 28 September 2007, the Company announced that it had entered into an
agreement ("Settlement Agreement") with Peak whereby Peak agreed to take over
certain current and future liabilities of the Bilabri oil development and to
reimburse Equator for certain costs.

Peak has not yet made the long overdue payments to Equator and third parties.
Therefore in accordance with the terms of the Settlement Agreement, Equator has
issued an Arbitration Notice to Peak. Arbitration under the Settlement Agreement
is to be held in London, England. Nevertheless, Equator remains committed in its
cooperation with Peak and various third parties to ensure that the oil and gas
discovered in Bilabri, Oribiri and Owanare are exploited to their maximum
potential. The Company will issue a further update in due course.

Related Party - AIM Rule 13

Mr Robert Gipson is one of three General Partners of Ingalls & Snyder Value
Partners LP ("Ingalls VP") and also a Senior Managing Director of Ingalls &
Snyder LLC ("Ingalls LLC"). Ingalls LLC currently holds 15.3 per cent of the
issued common shares in the Company of which 7,743,000 shares (4.2 per cent) are
held on behalf of Mr Gipson. Mr Gipson also holds directly 7,326,000 shares (4.0
per cent). Ingalls VP currently holds no shares.

Following this transaction, Ingalls LLC, Ingalls VP and Mr Gipson will hold in
total 40,245,767 common shares equivalent to 21.46 per cent of the issued
shares. Accordingly, the transaction to accept the exercise of the warrants at
the reduced price is being treated as a Related Party Transaction under the AIM
Rules. The Directors of the Company, all of whom are independent of Mr Gipson,
Ingalls LLC and Ingalls VP, consider, having consulted with the Company's
Nominated Adviser, that the terms of both transactions are fair and reasonable
insofar as the shareholders are concerned.

Enquiries:

Equator                                               +44 (0)207 235 2555
Philip Rand
Chief Executive Officer

Beaumont Cornish Limited (Nominated                   +44 (0)207 628 3396
Adviser to Equator)
Roland Cornish

Fox-Davies Capital Limited                            +44 (0)207 936 5234
(Nominated Broker to Equator)
Richard Hail

Buchanan Communications                               +44 (0)207 466 5000
Bobby Morse/Ben Willey


Information on Equator

Equator Exploration Limited engages in the exploration and development of oil
and gas projects in highly prospective West Africa. Equator's objective is to
build a diversified portfolio of exploration, appraisal and production assets in
the region. The Company has exploration interests in the territorial waters of
Nigeria and of Sao Tome e Principe as well as in the Joint Development Zone
between the two countries.

Additional information regarding the Company can be obtained from the Company's
website at www.equatorexploration.com.




                      This information is provided by RNS
            The company news service from the London Stock Exchange

END
MSCUUUAWPUPRGMR

Equator Exploration (LSE:EEL)
過去株価チャート
から 10 2024 まで 11 2024