Serinus Secures $60 Million EBRD Financing for Tunisia

CALGARY, ALBERTA--(Marketwired - Nov. 20, 2013) - Serinus Energy Inc. (TSX:SEN)(WARSAW:SEN) ("Serinus Energy", "SEN" or the "Company"), an international upstream oil and gas exploration and production company, is pleased to announce that it has signed two loan agreements in the aggregate amount of USD 60 million (the "Financing") with the European Bank for Reconstruction and Development (the "EBRD"). The Financing will assist the Company in funding the capital program being planned for its recently acquired oil and gas fields in Tunisia.

Highlights

• The Financing consists of two loans, one in the amount of $40 million (the "Senior Loan") and the second in the amount of $20 million which can be converted in to shares of the Company (the "Convertible Loan")
• The Senior Loan can be drawn in 2 tranches of $20 million each and carries an interest rate of Libor plus 6%
• Some or all of the Convertible Loan can be repaid with, or converted into common shares of the Company at the then current market price of the shares.

Tim Elliott, the President and Chief Executive Officer of Serinus said: "The EBRD played an important funding role in our success in Ukraine where we were able to increase production almost 500% in 40 months and we are very pleased to be able to work on a new project with the bank, which has been a true partner for us. The investment which we are about to make in Tunisia represents the largest single investment in our Company's history. This is not only a reflection of our confidence in the potential of our projects, but also our confidence in the future of Tunisia and its people".

The Financing

The Financing consists of two separate loan agreements. The Senior Loan is in the amount of USD 40 million, has a term of seven years, and is available in two tranches of USD 20 million each. Interest is payable semi-annually at a variable rate equal to the sum of the London UK interbank rate for a period equivalent to the interest payment period and 6%. At the Company's option, the interest rate may be fixed at the sum of 6% and the forward rate available to EBRD on the interest rate swap market. The Senior Loan is repayable in twelve equal semi-annual installments commencing after the first year of the loan. The second tranche of the Senior Loan is available only after the Convertible Loan is fully drawn, and is also subject to certain conditions including achieving and maintaining specified production targets for a period of three continuous months, and meeting specified financial and reserve coverage ratios.

The Convertible Loan in the amount of USD 20 million has a term of seven years, and bears interest at a variable rate that is the sum of a London interbank rate and a percentage calculated on the basis of incremental net revenues earned from the Tunisian assets, with a floor of 8% per annum and a ceiling of 17% per annum. The incremental net revenue provision of the interest cost of the Convertible Loan is intended to provide EBRD with a mechanism to share in the Company's success in Tunisia in a manner similar in concept to the Ukraine financing facility from 2011 between EBRD and a 70% owned subsidiary of the Company.

The Company can elect, subject to certain conditions, to convert all or any portion of the Convertible Loan principal and accrued interest outstanding for newly issued shares of the Company at the then current market price of the shares on the Toronto Stock Exchange ("TSX") or Warsaw Stock Exchange ("WSE"), as required by the exchange rules. The EBRD can also at any time, and on multiple occasions elect to convert all or any portion of the Convertible Loan principal and accrued interest outstanding for newly issued shares of the Company at the then current market price of the shares on the TSX or WSE. Conditions to conversion include a requirement for substantially all of the Company's assets and operations to be located and carried out in the EBRD countries of operations.

The Company can also repay the Convertible Loan at maturity in cash or in kind, subject to certain conditions, by issuing new common shares valued at the then current market price of the shares on the TSX or WSE. The repayment amount is subject to a discount of approximately 10% in the event that the requirement for substantially all of the Company's assets and operations to be located and carried out in the EBRD countries of operations is not met at the date of repayment.

Both loans are available for a period of three years, and the agreements contain certain conditions and fees considered to be normal for such financing facilities. The Convertible Loan is subject to the approval of the TSX, and on a repayment or conversion initiated by the Company, the number of shares that may be issued is limited to a maximum of 5% of the number of Company shares then issued and outstanding, with any amounts remaining outstanding then paid in cash. On a conversion initiated by EBRD, no such limit applies.

The security package for the Financing includes the Tunisian assets, pledges of certain bank accounts plus the shares of the Company's subsidiaries through which the concessions are owned, plus the benefits arising from the Company's interests in insurance policies and on-lending arrangements within the Serinus group of companies. Both loan agreements contain a number of affirmative covenants, including maintaining the specified security, environmental and social compliance, and maintenance of specified financial ratios, including a debt service coverage ratio, and a financial debt to EBITDA ratio.

Both loan agreements provide the Company with the right to make voluntary prepayments provided certain conditions are met and specified prepayment fees are paid. Mandatory prepayments may also be required in certain circumstances, including a change in ownership control of the Company, or the Company disposing its Ukraine subsidiary.

About Serinus

Serinus is an international upstream oil and gas exploration and production company with a diversified portfolio of projects in Ukraine, Brunei, Tunisia, Romania and Syria and with a risk profile ranging from exploration in Brunei, Romania and Syria to production and development in Ukraine and Tunisia. The common shares of the Company trade under trading symbol "SEN" on both the WSE (Warsaw Stock Exchange) and the TSX.

In Ukraine, Serinus owns an effective 70% interest in KUB-Gas LLC through its 70% shareholding of KUBGas Holdings Limited. The assets of KUB-Gas LLC 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 Tunisia, Serinus owns a 100% working interest in the Chouech Es Saida, Ech Chouech, Sanrhar and Zinnia concessions, and a 45% working interest in the Sabria concession. Four of the concessions are currently producing oil or gas.

In Brunei, Serinus 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 Romania, Serinus owns an undivided 60% working interest in the onshore Satu Mare concession, a 2,949 square kilometre exploration and development block, in north western Romania.

In Syria, Serinus 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. Serinus 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.

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 future activities of Serinus in Ukraine, Tunisia and Brunei that are not historical facts and to future activities of the Company in those countries. 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.

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