VANCOUVER, BC, May 27, 2024
/CNW/ - ShaMaran Petroleum Corp. ("ShaMaran" or the
"Company") (TSXV: SNM) (Nasdaq First North: SNM) refers to the
Company's press release on May 21,
2024, and announces that the Company has today issued a
summons for written resolution to all bondholders in the
outstanding 12% senior unsecured bond due July 2025 (ISIN NO 0011057622) (the "Bond"). The
summons proposes amendments to the Bond (the "Proposal"), including
a two-year extension to July 2027.
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The Company has met with and received strong support for the
Proposal from a large percentage of the bondholders. Approval of
the Proposal will enable the Company to better utilize all
available cash flow, above a prudent balance required to run the
business, in order to repay the Bond in an accelerated fashion
versus the current structure.
Elvis Pellumbi, Chief Financial
Officer of ShaMaran, commented, "Launching the bond proposal today
is an important step in allowing the Company to accelerate our debt
repayment efforts and enhance value for all stakeholders."
If the Proposal is approved, the Company is offering to
repurchase bonds through a $47
million tender offer, which, together with the cancellation
of the Company's own bonds ($5.9
million), will reduce the outstanding amount of the Bond by
approximately 21%. Several large bondholders, including the Lundin
family, have indicated that they do not intend to participate in
the tender offer, allowing the remaining bondholders to reduce the
size of their position by a significantly larger percentage through
the tender. Any unused tender amount will be repaid pro-rata
to all bondholders.
The size of the proposed tender exceeds the amount of the next
two scheduled amortisations per the current Bond terms, and, with
the proposed cash sweep mechanism effective July 30, 2024, the Company intends to accelerate
debt repayment in order to optimize its capital structure.
The Lundin family has agreed to extend their subordinated loan
to the Company beyond the proposed new maturity of the Bond, with
no other changes to the loan terms if the written resolution is
passed by bondholders.
The summons can be found on the Nordic Trustee website
(https://new.stamdata.com).
Pareto Securities has been engaged as Manager for the
contemplated proposal with ABG Sundal Collier and Clarksons
Securities engaged as Co-Managers.
All currency amounts indicated as "$" in this news release are
expressed in United States
dollars.
About ShaMaran Petroleum
Corp.
ShaMaran is a Canadian independent oil and gas company focused
on the Kurdistan region of
Iraq. The Company indirectly holds
an 18% working interest (22.5% paying interest) in the Sarsang
Block, and, subject to closing the previously announced
transaction, will increase its indirect 27.6% working interest in
the Atrush Block to 50%. The Company is listed in Toronto on the TSX Venture Exchange and in
Stockholm on Nasdaq First North
Growth Market (ticker "SNM"). ShaMaran is part of the Lundin Group
of Companies.
Important Information
ShaMaran is obliged to make this information public pursuant
to the EU Market Abuse Regulation. This information was
submitted for publication through the agency of the contact person
set out below on May 27, 2024,
at 9:30 a.m. Eastern Time.
The Company's certified advisor on Nasdaq First North Growth
Market is FNCA Sweden AB.
Forward-Looking Statements
Certain statements contained in this press release constitute
forward-looking information. These statements relate to future
events or the Company's future performance, business prospects and
opportunities, which are based on assumptions of
management.
The use of any of the words "will ", "expected", "planned"
and similar expressions and statements relating to matters that are
not historical facts are intended to identify forward-looking
information and are based on the Company's current belief or
assumptions as to the outcome and timing of certain future events.
Certain information set forth in this news release contains
forward-looking statements, including, but not limited to,
expectations of cash flow that may be impacted by the local demand
for oil continuing until the Iraq-Tűrkiye pipeline ("ITP")
reopening and its effect on the Company, including production in
Sarsang and Atrush, and the impact of the anticipated closing of
the TAQA/HKN transaction on the Company's indirect working interest
in the Atrush Block. There is no certainty that bondholders will
support the proposed amendments and vote in favour of such
amendments. These forward-looking statements involve risks and
uncertainties relating to, among other things, changes in oil
prices, results of exploration and development activities,
including results, timing and costs of seismic, drilling and
development related activity in the Company's area of operations,
uninsured risks, regulatory changes, defects in title, availability
of funds required to participate in the development activities,
availability of financing on reasonable terms, availability of
materials and equipment on satisfactory terms, outcome of
commercial negotiations with government and other regulatory
authorities, timeliness of government or other regulatory
approvals, actual performance of facilities, availability of third
party service providers, equipment and processes relative to
specifications and expectations and unanticipated environmental
impacts on operations. The risks outlined above should not be
construed as exhaustive. Additional information on these and other
factors that could affect the Company's operations and financial
results are included in the Company's annual information form for
the year ended December 31, 2023, and
other reports on file with the Canadian Securities Regulatory
Authorities that can be accessed on the Company's profile on
SEDAR+. Actual future results may differ materially. Various
assumptions or factors are typically applied in drawing conclusions
or making the forecasts or projections set out in forward-looking
information. With respect to the forward-looking statements in this
news release, the Company has made assumptions regarding, among
other things, local sales demand and prices, the timing and
conditions to the reopening of the ITP, the closing of the TAQA/HKN
transaction, future oil and gas prices and that the Company will be
able to raise sufficient capital to fund its operations, if needed.
Those assumptions and factors are based on information currently
available to the Company. The forward-looking information contained
in this release is made as of the date hereof, and the Company is
not obligated to update or revise any forward-looking information,
whether as a result of new information, future events or otherwise,
except as required by applicable securities laws. Because of the
risks, uncertainties and assumptions contained herein, investors
should not place undue reliance on forward-looking information. The
foregoing statements expressly qualify any forward-looking
information.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE ShaMaran Petroleum Corp.