Printer Friendly

ARAKIS ENERGY ANNOUNCES CDN$5M FINANCING FOR NATURAL GAS DEVELOPMENT

 ARAKIS ENERGY ANNOUNCES CDN$5M FINANCING FOR NATURAL GAS DEVELOPMENT
 VANCOUVER, July 17 /PRNewswire/ -- Terry Alexander, president and CEO, today announced that Arakis Energy Corporation (VSE: AKS) has entered into a letter of agreement with Energy Equities Inc. of New York to place Cdn.$5 million of convertible debentures on a best efforts basis.
 The term of the debentures will be 6 years and will pay an annual interest rate of 9 percent. The debentures will be convertible into shares at $3.00 per share in the first year, increasing every year thereafter, and will include warrants to purchase an equivalent number of shares, at $3.50 per share in the first year and also increasing every year thereafter. A finder's fee of 5 percent is payable on the net proceeds. The financing will be subject to regulatory approval.
 The funds raised will be used to drill and bring on stream 75 developmental gas wells located within Arakis' existing gas fields in Southeastern Kentucky. Arakis' interest in the new developmental gas wells is 100 percent. It is expected that once the drilling is complete and all new production is on stream, Arakis will be selling about 10 million cubic feet of natural gas per day. Current spot prices for natural gas have steadied for the summer selling season and are currently at $1.80/MCF (thousand cubic feet). Arakis has until now specialized in natural gas development and production, and owns and operates 228 natural gas wells in Southeastern Kentucky, located on over 100,000 acres of PNG leases.
 Arakis has recently entered into a letter of intent to acquire 100 percent of State Petroleum Corporation ("State"). State is currently completing negotiations to acquire a 170,000 square kilometer oil concession containing 2 major oil field discoveries in the Republic of Sudan.
 A review of the available engineering data estimates that there is an initial 1.4 Billion barrels of oil in place located within the concession, of which 20 percent, or about 280 million barrels, is proven recoverable reserves. It is further estimated that there is the potential to develop up to 3.5 billion barrels of oil reserves within the large concession. Arakis and State are in the process of raising the $50 million required to cover the first stage development costs to bring commercial production to about 10,000 bbls/day. Initial production would come from the al-Muglad, abu Gabra and Heglig areas which lie about 740 km (460 miles) southwest of the capital of Khartoum. Sudan's current domestic oil needs are estimated at 60,000 barrels daily. Future plans, after further developmental drilling, pipeline and refinery construction, should increase daily production to about 300,000 bbls/day from the Sudanese oil concessions.
 -0- 7/17/92 R
 /CONTACT: David Robinson of Arakis Energy, 604-685-7933, or U.S. Toll-free 800-665-7037/
 (AKS.) CO: Arakis Energy Corporation ST: British Columbia IN: OIL SU: FNC


TS -- NY011 -- 0195 07/17/92 11:16 EDT
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Jul 17, 1992
Words:494
Previous Article:LIMBACH CONSTRUCTORS, INC. NAMED FIFTH LARGEST MECHANICAL CONTRACTOR IN UNITED STATES
Next Article:FEDERAL SIGNAL DECLARES QUARTERLY CASH DIVIDEND
Topics:


Related Articles
ARAKIS ENERGY ANNOUNCES CDN$5M FINANCING FOR NATURAL GAS DEVELOPMENT
ARAKIS ENERGY CORP. ARRANGES PRODUCTION FUNDING FOR SUDANESE OIL PROJECT
ARAKIS ENERGY CORP. SECURES EQUITY FINANCING FOR NATURAL GAS DRILLING IN KENTUCKY
ARAKIS ENERGY CORP. ARRANGES FURTHER EQUITY FINANCING
ARAKIS ENERGY CORPORATION SPUDS WELL NO. 14 OF CURRENT NATURAL GAS DRILLING PROGRAM
ARAKIS COMPLETES ANOTHER SUCCESSFUL NATURAL GAS WELL; NEGOTIATIONS CONTINUE ON SUDAN PRODUCTION SHARING AGREEMENT; LONDON OFFICE OPENED
ARAKIS REPORTS ADDITIONAL GAS DRILLING SUCCESS
INITIAL GOVERNMENT APPROVAL GIVEN TO 40,000 BOPD PROJECT DEVELOPMENT PLAN
SUDAN - The Background.
Sudan - The Background.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters