Iona Energy Inc.

Iona Energy Inc.

September 30, 2013 15:58 ET

Iona Energy Announces Settlement of Senior Secured Callable Bond Issue and Repayment of Bank Facility

CALGARY, ALBERTA--(Marketwired - Sept. 30, 2013) -


Iona Energy Inc. ("Iona" or the "Company") (TSX VENTURE:INA) is pleased to announce the settlement of the previously announced USD 275 million senior secured bonds (the "Bonds") issued by its UK subsidiary, Iona Energy Company (UK) Limited (the "Issuer"), and full repayment of the Company's Senior Secured Borrowing Base Facility (the "BBF"). Pareto Securities acted as Sole Manager and Bookrunner of the Bond issue.

The settlement date for the Bonds was September 27, 2013 (the "Settlement Date") and the Bonds will mature on September 30, 2018 after their five year term. The Bonds carry an annual coupon rate of 9.5% payable semi-annually, were issued at 97.5% of par and are callable in whole or in part at the option of the Issuer at any time. The amortization profile is tailor made to match the cash flow profile of Iona's existing asset base and is structured to enable Iona to bring Orlando, its next significant development project, on stream before commencing amortization payments. Commencing 30 months after the Settlement Date, the Bonds will amortize 15% of the issue amount every six months with a 25% final payment at maturity. The amortizations will be performed at the prevailing call option prices of 105%, 104%, 104%, 103% and 103% of par value with the residual amount payable at 102% of par value.

In addition to repayment and closure of the BBF, proceeds from the Bonds were also used to retire 3.1 million call options (effective between October 2014 and September 2016) of the approximately 7.4 million outstanding call options sold to Britannic Trading Limited, a subsidiary of BP Oil International Limited, in February of 2013. Further, Bond proceeds have satisfied all payments owed to Carrizo Oil & Gas, Inc. for the Company's acquisition of its interest in the Huntington field.

Neill Carson, Iona's CEO commented: "With the net proceeds of this financing, the Company is well-situated with approximately USD 100 million in current cash to be used towards the development of Orlando and to expedite other initiatives within its portfolio of high-quality assets. Importantly, the Bond issue allows Iona to gain immediate access to previously restricted monthly cash flows from the Huntington and Trent & Tyne fields. With this foundation, Iona is financially capable of developing all of its core projects, which are expected to take production to 17,000 boe/d by the end of 2016, more than doubling Iona's anticipated 2013 exit rate."

Additional information relating to the Company is available on SEDAR at

About Iona Energy:

Iona is an oil and gas exploration, development and production company focused on oil and gas development and exploration in the United Kingdom's North Sea.

Forward-looking statements

Some of the statements in this announcement are forward-looking, including statements regarding Iona's business plans and anticipated production levels. Forward-looking statements include statements regarding the intent, belief and current expectations of Iona Energy Inc. or its officers with respect to various matters, including production, drilling activity or otherwise. When used in this announcement, the words "expects", "believes", "anticipate", "plans", "may", "will", "should", "scheduled", "targeted", "estimated" and similar expressions, and the negatives thereof, are intended to identify forward-looking statements. Such statements are not promises or guarantees, are based on various assumptions by Iona's management, including assumptions relating to development timelines and the increase of Iona's working interest in its Trent & Tyne property from 20.0% to 37.5%, and are subject to risks and uncertainties that could cause actual outcome to differ materially from those suggested by any such statements, including without limitation, the risk of unanticipated delays impacting future production rates from Orlando. These forward-looking statements speak only as of the date of this announcement. Iona Energy Inc. expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any forward-looking statement is based except as required by applicable securities laws.

Notes Regarding Oil and Gas Disclosure

As used in this press release, "boe" means barrel of oil equivalent on the basis of 6 mcf of natural gas to 1 bbl of oil. Boes may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Neither the TSX Venture Exchange Inc. nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Iona Energy Inc.
    Neill A. Carson
    Chief Executive Officer
    +44 1224 228400

    Iona Energy Inc.
    Graham A. Heath
    Interim Chief Financial Officer
    +44 7508 932986

    Iona Energy Inc.
    David Ricciardi
    Investor Relations
    +1 403 978 4894