Iona Energy Inc.

TSX VENTURE : INA


February 21, 2013 09:40 ET

Iona Energy Updates Status of Transactions

CALGARY, ALBERTA--(Marketwire - Feb. 21, 2013) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR DISSEMINATION IN UNITED STATES

Iona Energy Inc. ("Iona" or the "Company") (TSX VENTURE:INA), is pleased to announce the following in relation to previously announced and newly completed transactions:

  • The Company has closed its previously announced bought-deal private placement of common shares (the "Offering"). An aggregate amount of CAD$23 million was raised pursuant to the Offering. Casimir Capital Ltd. ("Casimir") acted as lead underwriter with National Bank Financial as a syndicate member;
  • The Company has signed a Senior Secured Borrowing Base Facility for up to USD$250 million (the "BBF") with a group of three banks led by Bank of America Merrill Lynch, Lloyds TSB Bank plc, and BNP Paribas. Completion and utilization of the BBF is subject to satisfaction of standard conditions precedent;
  • Iona has completed a USD$60 million structured energy derivative transaction ("Structured Derivative Transaction") with Britannic Trading Ltd. ("BTL"), a subsidiary of BP International Limited;
  • The Company has also entered into a Marketing and Offtake Agreement with BP Oil International Limited;
  • Iona has completed its sale of a 25% working interest in its UK North Sea Orlando and Kells fields to Volantis Exploration (the "Orlando/Kells Sale") for total gross proceeds of USD$34 million on close and pro-rata share of future staged payment obligations;
  • Iona UK has delivered a letter to the UK's Department of Energy and Climate Change ("DECC") in support of the Orlando Field Development Plan and confirming adequate funds have been allocated to the development; and
  • Proceeds from the Offering, the Structured Derivative Transaction, the completion of the Orlando/Kells Sale, and expected initial funds available for drawing of USD$139 million under the BBF, together with existing working capital will total in excess of USD$274 million. Net proceeds will be allocated to closing the Company's previously announced Huntington oil field acquisition from Carrizo Oil & Gas Ltd., completion of the acquisition of the Orlando interest from Sorgenia and MPX, and to fund capital expenditures of its existing property developments as previously announced.

Neill Carson, Iona's CEO, commented: "the closing of these transactions enables a step change in growth for our company on several fronts. We are confident in achieving our production goal of over 7,000 boepd by mid 2013, when adding our acquisition of Huntington near-term oil production to our existing gas production at Trent & Tyne. We are committed to deliver on the development of the Orlando oil field. We believe we have established the basis for an excellent long term relationship with our funding partners."

Brad Gunn, Iona's CFO, added: "Completions of these financings are significant achievements and we welcome our new partners to our development projects. Financing of this magnitude is evidence of the confidence of the financial community in Iona's strategy, assets, and team of seasoned executives and employees. Iona sincerely appreciates the efforts and strong show of support of its lenders and BTL."

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.

The securities of Iona being offered have not been, nor will be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent U.S. registration or an applicable exemption from U.S. registration requirements. This release does not constitute an offer for sale of securities in the United States.

Forward-looking Statements

Some of the statements in this announcement are forward-looking, including statements regarding the proposed terms of the Offering and anticipated closing dates of various transactions of Iona. 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 the Offering. 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 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 that the transactions described herein do not close concurrently, are delayed for any reason, or are not completed. 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.

Neither TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the 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
    +011 (44) 1224 228400

    Iona Energy Inc.
    Brad G. Gunn
    Chief Financial Officer
    (403) 775-7442