Kulczyk Oil Ventures Inc.: Ukraine-KUB-Gas Prepays USD 10.0
Kulczyk Oil Ventures Inc.: Ukraine-KUB-Gas Prepays USD 10.0 Million to EBRD
CALGARY, ALBERTA -- (Marketwire) -- 01/08/13 -- Kulczyk Oil Ventures Inc. (WARSAW:KOV) ("Kulczyk Oil", "KOV" or the "Company") is pleased to announce that the Company's indirectly held 70% subsidiary KUB-Gas LLC ("KUB-Gas") has made a prepayment to the European Bank for Reconstruction and Development ("EBRD") in the amount of USD 10.0 million under the terms of the EBRD loan agreement ("Loan"). KUB-Gas will also make a regularly scheduled principle payment in the amount of USD 935,897 on January 15, 2013. Following these repayments, the outstanding balance of the EBRD loan after January 15, 2013 will be USD 10,294,872.
The Loan, initially for an amount of up to USD 40 million, was signed in May 2011 with the funds therefrom intended to finance the ongoing development of additional production from KUB-Gas' Vergunskoye, Olgovskoye, Makeevskoye and Krutogorovskoye fields in the Lugansk region of Ukraine. The first tranche of the Loan in the amount of USD 23.0 million was fully drawn. However, with consistently strong production and financial performance from KUB-Gas' producing properties, the second tranche of USD 17.0 million was never drawn. The USD 10.0 million prepayment on the first tranche was made from KUB-Gas' internally generated funds.
Tim Elliott, President and Chief Executive Officer, stated that:
"Early repayment has been made possible by the excellent results we have had in Ukraine to date. The capital made available under the loan agreement was critical in allowing us to kick start our aggressive development program and the EBRD has proven to be an effective and meaningful partner for us. We continue to be optimistic about the future of KUB-Gas and will continue with our exploration and development plans which will be self-funded going forward."
About Kulczyk Oil
Kulczyk Oil is an international upstream oil and gas exploration and production company with a diversified portfolio of projects in Ukraine, Brunei and Syria and with a risk profile ranging from exploration in Brunei and Syria to production and development in Ukraine. The common shares of the Company trade on the Warsaw Stock Exchange under trading symbol "KOV".
In Ukraine, KOV owns an effective 70% interest in KUB-Gas LLC. The assets of KUB-Gas consist of 100% interests in five licences near to the City of Lugansk in the northeast part of Ukraine. Four of the licences are gas producing.
In Brunei, KOV owns a 90% working interest in a production sharing agreement which gives the Company the right to explore for and produce oil and natural gas from Block L, a 1,123 square kilometre area covering onshore and offshore areas in northern Brunei.
In Syria, KOV holds a participating interest of 50% in the Syria Block 9 production sharing contract which provides the right to explore for and, upon the satisfaction of certain conditions, to produce oil and gas from Block 9, a 10,032 square kilometre area in northwest Syria. The Company has an agreement to assign a 5% ownership interest to a third party which is subject to the approval of Syrian authorities, and which, if approved, would leave the Company with a remaining effective interest of 45% in Syria Block 9. KOV declared force majeure, with respect to its operations in Syria, in July 2012.
The main shareholder of the Company is Kulczyk Investments S.A., an international investment house founded by Polish businessman Dr. Jan Kulczyk.
For further information, please refer to the Kulczyk Oil website (www.kulczykoil.com).
Translation: This news release has been translated into Polish from the English original.
Forward-looking Statements: This release may contain forward-looking statements made as of the date of this announcement with respect to future activities of KUB-Gas and related to its five licence areas in Ukraine and to certain wells drilled or seismic activities undertaken within those licence areas that either are not or may not be historical facts. Although the Company believes that its expectations reflected in the forward-looking statements are reasonable as of the date hereof, any potential results suggested by such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Various factors that could impair or prevent the Company from completing the expected activities on its projects include that the Company's projects experience technical and mechanical problems, there are changes in product prices, failure to obtain regulatory approvals, the state of the national or international monetary, oil and gas, financial, political and economic markets in the jurisdictions where the Company operates and other risks not anticipated by the Company or disclosed in the Company's published material. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties and actual results may vary materially from those expressed in the forward-looking statement. The Company undertakes no obligation to revise or update any forward-looking statements in this announcement to reflect events or circumstances after the date of this announcement, unless required by law.
Canada Suite 1170, 700-4th Avenue S.W., Calgary, Alberta, Canada Telephone: +1-403-264-8877 Dubai Al Shafar Investment Building, Suite 123, Shaikh Zayed Road, Box 37174, Dubai, United Arab Emirates Telephone: +971-4-339-5212 Poland Nowogrodzka 18/29 00-511 Warsaw, Poland Telephone: +48 (22) 414 21 00
Contacts: Kulczyk Oil Ventures Inc. - Canada Norman W. Holton Vice Chairman +1-403-264-8877 firstname.lastname@example.org
Kulczyk Oil Ventures Inc. - Poland Jakub J. Korczak Vice President Investor Relations & Managing Director CEE +48 22 414 21 00 email@example.com www.kulczykoil.com