COPL Farms Into Bluebell Prospect
Canadian Overseas Petroleum Limited (COPL), through its wholly owned subsidiary, Canadian Overseas Petroleum (UK) Limited, has signed a farm-in agreement with Premier Oil UK Limited for the Bluebell prospect in Blocks 15/24c and 15/25f, License P.1466, in the UK North Sea. Under the terms of the farm-in, the Company will pay 66.67% of the cost to drill a well to earn a 40% equity interest in the prospect.
The farm-in for Bluebell, together with the farm-in agreement with Faroe Petroleum (U.K.) Ltd. announced December 6, 2010 for Blocks 206/5a and 206/10a, License P.1161, satisfy the requirements for the first release condition of the Company's recent $130 million offering of subscription receipts. As such, $39 million (30% of the gross $130 million financing) currently held in escrow will be eligible to be released to the Company to fulfill its obligations under the foregoing farm-ins. The farm-in agreements remain subject to certain conditions precedent and regulatory approvals.
Concurrent to the process of releasing the escrowed funds, 78 million subscription receipts (30% of the total 260 million subscriptions receipts financing) will be automatically exercised into common shares and warrants. Each subscription receipt entitles the holder to one (1) common share and one-half of one (0.5) common share purchase warrant. The common shares will trade on the TSX Venture Exchange ("TSX-V") under the symbol XOP, but the associated warrants will not be listed. The remaining 182 million subscription receipts will continue to trade on the TSX-V under the symbol XOP.R until the Company satisfies the terms of the second release condition for the remaining 70% of the escrowed funds, or until the expiry deadline of March 1, 2011. </p><p>
Canaccord Genuity Corp. acted as financial advisor to the Company in connection with the farm-in agreements with Premier Oil UK Limited and Faroe Petroleum (U.K.) Ltd.
Operates 1 Offshore Rigs
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