Rocksource Reports Successful Bond Issue

Rocksource ASA Group has closed a five-year Senior Secured Bond Loan through a private placement directed toward Norwegian and international investors. The loan was fully subscribed, with a total loan amount of NOK200-million. The arranger of the private placement was DnB NOR Markets.

The loan, which has a term of five years, carries a coupon of three months NIBOR + 5.0% payable quarterly in arrears. The loan includes a call option whereby Rocksource has the option to redeem the loan before maturity. The settlement date is May 4, 2007. The bond issuance is subject to finalized loan documentation and approval of the loan documentation by the Trustee (Norsk Tillitsmann ASA).

Rocksource is continuously evaluating the capital structure with the aim of having an optimal mix of equity and debt capital to reduce the Group's cost of capital. The recent bond issue concludes the work on the capital structure starting with the bank loan facility of NOK150 million related to exploration on the Norwegian Continental Shelf (NCS), and the equity issue of NOK78 million, both completed in March.

The completed financing activities allow Rocksource to pursue its growth strategy, including:

  • Increasing reserves and production in the US through a further drilling campaign.
  • Maturing existing licenses on the Norwegian and United Kingdom continental shelves.
  • Positioning the Group for coming licensing rounds, including the EM-campaign on the NCS for the APA 2007 and 20th Round.
  • To further build the organization to qualify as an operator on the NCS.
  • Increased activity related to international exploration, including licensing rounds and farm- ins.

Tommy Sundt, CFO of Rocksource ASA, said: "I am very pleased to see that we have concluded these steps in securing a sound capital structure and the necessary financial capabilities to support our ambitious growth strategy."

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