Kulczyk Oil Ventures Inc.
WARSAW : KOV

Kulczyk Oil Ventures Inc.

May 11, 2011 05:40 ET

KOV to Seek Listing and Capital Raise on AIM

Highlights

- KOV intends to list on AIM, with full commitment to remain listed on WSE;

- Debut on AIM and new share issuance planned for the fourth quarter 2011;

- Funds to be raised to finance KOV's participation in the Neconde consortium and 2012 work programs in Brunei and Syria.

CALGARY, ALBERTA--(Marketwire - May 11, 2011) -

Details

Kulczyk Oil Ventures Inc. ("KOV" or the "Company") (WARSAW:KOV) announces that it plans to seek a listing of its common shares on the London Alternative Investment Market ("AIM") and that the Company intends to raise new equity capital there in Autumn 2011. Detailed plans and timing of the AIM listing and further information about the amount of capital expected to be raised in the proposed financing will be released at a later date once this information has been determined.

The decision by the Company to seek dual listing of its common shares on AIM is driven by the desire to provide broader investor access to KOV shares on a major equity market recognized for international oil and gas companies while continuing its commitment to its strong Polish investors base through maintaining its present listing on the Warsaw Stock Exchange ("WSE").

KOV intends to raise funds on AIM in an amount sufficient to fund its ownership interest in the OML 42 license in Nigeria via its participation in the Neconde consortium. KOV, through its indirect wholly-owned subsidiary companies plans to acquire 20% of Neconde's ordinary issued equity thereby giving KOV an effective indirect 9% interest in OML 42. Kulczyk Investments ("KI"), the Company's major shareholder, is providing the Company with bridge financing in respect of the Company's share of Neconde's acquisition costs, and KI holds KOV's shares in Neconde in trust for KOV until such time, and to the extent that, it can repay those funds owing to KI under the bridge financing arrangements.

"KOV will work with the Neconde consortium to re-activate production in a fast and efficient way and to expand the base of production and reserves from OML 42 over the coming years. KOV has demonstrated an ability to increase the value proposition of the projects we are engaged in by increasing both production and reserves on our assets in Ukraine." said Jock Graham, Executive Vice President of Kulczyk Oil.

A portion of the new equity funds to be raised on AIM will be used by KOV to fund its 2012 work programme for Brunei, where it holds 40% and 36% stakes in Block L and Block M, respectively and in Syria, where KOV has an effective 45% stake in Block 9.

Over 80 exploration and production ("E&P") companies, with a combined market capitalization of GBP 17.4 billion, are currently listed on the London AIM.

"London is a global business centre, as well as one of the key financial centres for our industry. Our presence on AIM will help consolidate KOV's position in the international market" added Jakub Korczak, Vice President Investor Relations & Managing Director CEE.

Assets of Kulczyk Oil

Kulczyk Oil is an international upstream oil and gas exploration company with a diversified portfolio of projects in Brunei, Syria and Ukraine and with a risk profile ranging from exploration in Brunei and Syria to production and development in Ukraine.

In Brunei, KOV owns working interests in two production sharing agreements which gives the Company the right to explore for and produce oil and natural gas from Block L and Block M. KOV owns a 40% working interest in Block L, a 2,220 square kilometre (550,000 acre) area covering onshore and offshore areas in northern Brunei and a 36% working interest in Block M, a 3,011 square kilometre (744,000 acre) area onshore in southern Brunei.

In Ukraine, KOV owns an effective 70% interest in KUB-Gas LLC. The assets of KUB-Gas consist of 100% interests in five licenses near to the City of Lugansk in the northeast part of Ukraine. Four of the licenses are gas producing.

In Syria, KOV holds a participating interest of 70% in the Syria Block 9 production sharing contract which provides the right to explore for and, upon fulfillment of certain conditions, to produce oil and gas from Block 9, a 10,032 square kilometre (2.48 million acre) area in northwest Syria. The Company has agreements to assign an aggregate of 25% in ownership interests to third parties which are 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.

The main shareholder of the Company, Kulczyk Investments S.A. owns almost 50% of the issued common shares. Kulczyk Investments S.A. is 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 contains forward-looking statements made as of the date of this announcement with respect to the dual listing on AIM that are not historical facts. Although the Company believes that its expectations reflected in the forward-looking statements are reasonable as of the date hereof and that the Company will be able to undertake and complete the AIM listing and financing, and further, to participate in the Nigerian opportunity, 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 AIM listing, the financing and participating in the Nigerian opportunity and completing the expected activities on this project including whether the Company can raise the required funds for the Company's share of Neconde's acquisition costs either at closing of the acquisition or through a repayment of the bridge financing from KI. The ability to raise the required funds will be dependent on the state of the national or international monetary, oil and gas, financial, political and economic markets in the jurisdictions where the Company operates or anticipates operating and other risks associated with the Company's operations identified in the Annual Information Form dated March 29, 2011. Various factors could also affect the closing and the timing of closing of the acquisition by Neconde including the regulatory approvals and whether the Company will realize the benefits expected upon completion of the acquisition and participation in Neconde. 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. The forward-looking statements contained herein are expressly qualified by this cautionary statement.

Canada
Suite 1170, 700-4th Avenue S.W., Calgary, Alberta, Canada
Telephone: +1-403-264-8877
Facsimile: +1-403-264-8861
Dubai
Al ShafarInvestmentBuilding, Suite 123, Shaikh Zayed Road,
Box 37174, Dubai, United Arab Emirates
Telephone: +971-4-339-5212
Facsimile: +971-4-339-5174
Poland
Nowogrodzka 18/29
00-5211 Warsaw, Poland
Telephone: +48 (22) 414 21 00
Facsimile: +48 (22) 412 48 60

Contact Information

  • Kulczyk Oil Ventures Inc. - Canada
    Norman W. Holton
    Vice Chairman
    +1-403-264-8877
    nholton@kulczykoil.com

    Kulczyk Oil Ventures Inc. - Poland
    Jakub J. Korczak
    Vice President Investor Relations & Managing Director CEE
    +48 22 414 21 00
    jkorczak@kulczykoil.com