As previously announced, the $130 million financing proceeds will be used to reimburse Urals Energy for development costs incurred at the Dulisminskoye Field in East Siberia since the Field's acquisition in June 2006, the defeasance of cash interest payments for the first two years of the financing facility, and the remainder for future capital and operating costs to develop the Dulisminskoye Field to its projected peak production level of 30,000 BOPD by 2011.
The completion of this financing enables Urals Energy to proceed with the development of the Dulisminskoye Field and its connection to Transneft's East Siberia Pacific Ocean Pipeline (the "ESPO"). Transneft recently announced that it has completed the construction of approximately 700 kms of the ESPO which will transit within approximately 70 km of the Dulisminskoye Field.
The financing was arranged by Goldman Sachs and funded by Standard Bank.
William R Thomas, CEO, commented:
"Receipt of the full funding of the US$130 million is a strong sign of support from the capital markets and we are now focused on developing this important asset."
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