Salamander Energy Limited, an independent upstream oil and gas exploration and production company focused on South East Asia, announces the proposed application for admission of the ordinary shares of a new holding company to the Official List of the FSA and to trading on the main market for listed securities of the London Stock Exchange.
Salamander is an independent upstream oil and gas exploration and production company focused on South East Asia. Since its formation, Salamander has built a balanced portfolio of production, development and exploration assets with interests principally located in Indonesia and Thailand. Salamander is in the final stages of negotiation of a Production Sharing Contract ("PSC") for two exploration blocks in Laos.
- Salamander has a clear strategy of acquiring and developing high quality oil and gas producing assets that provide potential near-term value and cash flow growth. The Group's current assets have upside potential and are located in basins where Salamander believes it can further exploit its geological knowledge.
- In less than two years, Salamander's daily working interest production rate has risen to approximately 6,600 boepd made up of approximately 4,100 bopd of oil production and approximately 15 mmscfd of gas. This is expected to rise to over 8,000 boepd in 2007.
- Salamander has raised two rounds of equity finance in March and December 2005. Early stage investors include 3i, Macquarie, Artemis and Lansdowne Partners.
- Salamander also secured asset-backed debt facilities in February 2006.
- The Group has offices in Singapore, Jakarta and London and employs 24 staff.
Salamander has an estimated proved plus probable (2P) reserves base of 40 mmboe as at mid-year 2006, of which approximately 34% is oil and 66% is gas.
In addition to its 2P reserves, Salamander has further opportunities for reserves growth from its current producing portfolio as well as its appraisal and exploration inventory:
- Approximately 15 mmboe of net best estimate contingent resources in commercial fields.
- Approximately 32 mmboe of net resources in six discoveries to be appraised in 2007/8.
- Over 50 mmboe of potential upside in the Phu Horm field.
- Targeting over 400 mmboe of incremental unrisked prospective resources in prospects and leads.
- Over 50 further leads that are yet to be evaluated by the Company.
South East Asia is home to extensive hydrocarbon producing basins and the region has enjoyed over 40 years of production growth. Since the early 1970s there has been substantial foreign investment in the upstream oil and gas sector in the region, which is characterized by an open investment climate in the energy sector and stable GDP growth in recent years.
In Indonesia the Company holds a 5% interest in the BP-operated Offshore North West Java PSC, a 5% interest in the CNOOC-operated South East Sumatra PSC and a 70% operated-interest in the Bontang PSC which encompasses the Tutung discovery and several identified leads.
In Thailand, Salamander holds a 9.5% interest in the Hess-operated Phu Horm gas field in North-East Thailand which is expected to come on-stream during November 2006, a 27.2% interest in the APICO-operated blocks L15/43 and L27/43 and (subject to Thai Cabinet ratification) a 16.3% interest in the APICO-operated block L13/48.
In Laos, the Company has received approval for its application to explore for oil and gas and is currently negotiating a PSC for the Vientiane and Savannakhet Blocks.
The Company is actively pursuing new business opportunities in Indonesia and the Greater Mekong Area (including Thailand, Laos and Vietnam).
Details of the Global Offering
The Global Offer will comprise an offer of existing and new ordinary shares in the capital of the Company to institutions in the United Kingdom and elsewhere, and to certain institutions in the United States (under Rule 144A).
- Joint Global Co-ordinators, Joint Bookrunners and Joint Sponsors to the proposed flotation are Merrill Lynch and Oriel Securities
Use of Proceeds
The new funds will be used to exploit the Company's current portfolio of opportunities, including:
Appraisal of the Tutung discovery in Indonesia plus the Si That and Dong Mun discoveries in Thailand.
Further appraisal and development of the Phu Horm field in Thailand.
3D seismic acquisition and exploration drilling in the Bontang PSC, Indonesia.
Frontier exploration activity to be progressed in Laos.
Additional new business development opportunities, such as exploration acreage in Vietnam.
In addition, the Company will redeem existing preference shares and pay transaction fees related to the IPO.
- Salamander aims to pursue growth both organically and through acquisitions, maintaining flexibility under differing market conditions.
- The Company believes it has a competitive advantage due to specific focus on South East Asia where the Company's management and technical team have extensive experience.
- The management's technical knowledge combined with corporate finance expertise and transactional experience will support the identification and capture of strategically attractive, value accretive acquisitions.
- The Company intends to target organic growth in proven, under-explored basins and overlooked frontier basins and maintain a balanced portfolio taking advantage of regional diversification.
Salamander's management and technical team share over 230 years of experience in the oil and gas sector, of which more than 125 years have been spent in South East Asia working for a broad range of leading companies.
- James Menzies, CEO has over 20 years of experience in the oil and gas industry. Prior to founding Salamander Energy, James held senior positions in LASMO and Lambert Energy Advisory.
- Andrew Cochran, Business Development Director is one of the founders of the Company and has over 20 years of industry experience. In the past he was the founder of Endeavour International Corp and was also New Ventures Advisor at Anadarko Petroleum.
- Nick Cooper, CFO prior to founding Salamander was a Vice President of Oil & Gas Investment Banking at Goldman Sachs and has extensive experience in the sector. Previously held positions at BG, Amoco and Booz-Allen & Hamilton.
- Mike Buck, Managing Director SE Asia has over 26 years experience in the international E&P sector. Mike has held senior positions in LASMO plc and ENI SpA, including Managing Director ENI Iran, General Manager ENI Pakistan, General Manager LASMO Libya and Exploration Manager, LASMO Vietnam.
James Menzies, Chief Executive Officer Salamander Energy PLC, commented:
"In a short space of time Salamander has rapidly built a balanced and diversified portfolio of operated and non-operated assets in a highly prospective region of strong economic growth that is energy-hungry. We have current production and near-term growth from fields in Indonesia and Thailand, an active 2007/08 appraisal drilling program and are commencing extensive exploration activities.
We believe the funds raised from the flotation will allow the company to accelerate its growth plans, and continue to create shareholder value."
This announcement is an advertisement and not a prospectus and investors should not subscribe for or purchase any shares referred to in this announcement except on the basis of information in the prospectus (the "Prospectus") to be published by Salamander Energy PLC in due course in connection with the admission of its ordinary shares ("Ordinary Shares") to the Official List of the Financial Services Authority (the "FSA") and to trading on the main market for listed securities of London Stock Exchange plc (the "London Stock Exchange"). Copies of the Prospectus will, following publication, be available from Salamander Energy plc's registered office at Charter House, Carteret Street, London SW1H 9DJ.