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Echo Energy #ECHO – Successful Completion of Debt Restructuring & TVR
Echo Energy, the Latin American focused upstream oil and gas company, is delighted to announce that at the adjourned meeting of the holders of the Company’s Luxembourg listed EUR 20.0m 8.0% secured notes (the “Notes”) held earlier today (the “Noteholder Meeting”) to consider the Company’s proposals for the restructuring of the Notes (the “Proposals”), the Proposals were duly approved by the requisite majority.
At the Noteholder Meeting voting instructions representing EUR 12.5m of the Notes were lodged by holders of the Notes (“Noteholders”) with 84 per cent. of votes cast in favour of the Proposals. As a result:
- Maturity of the Notes will be extended by three years to 15 May 2025 (the “Maturity Date”); and
- All cash interest payments on the Notes rolled to the Maturity Date.
Further details of the Proposals were set out in the Company’s announcement of 22 February 2021.
As a result of Noteholder approval of the Proposals, the previously announced conditional restructuring of the Company’s EUR 5.0m 8.0% secured convertible debt facility (the “Debt Facility”), details of which were announced by the Company on 1 December 2020, will now also become effective.
The restructuring of the Debt Facility will, inter alia, see its final maturity extended to April 2025, with no further cash interest payments required prior to final maturity.
Martin Hull, Echo’s Chief Executive Officer, commented:
“I am delighted that Echo has now successfully completed the restructuring of its debt obligations. The new arrangements result in no cash payments to Noteholders until maturity in 2025. This enables the Board to focus on rapidly delivering on its strategy to improve shareholder returns.
Commodity price strength, including the very material increases in gas price recently announced, combined with the more than doubling of oil production following the ongoing infrastructure upgrades, provide a markedly improved and positive outlook for shareholders.
This is a landmark moment for Echo and I am confident that we can now drive forward and reward shareholders in the future.”
With the Proposals approved by Noteholders, the Company will issue a total of 11,473,929 new ordinary shares in the Company (representing c.0.9% of the Company’s current issued ordinary share capital) to Noteholders pro rata to their voting instructions cast in favour of the Proposals at the Noteholder meeting (the “New Ordinary Shares”).
Application has been made for the 11,473,929 New Ordinary Shares to be admitted to trading on AIM (“Admission”) and it is expected that Admission will occur at 8.00 a.m. on or around 1 April 2021. Following Admission of the New Ordinary Shares, the Company’s issued ordinary share capital will comprise 1,219,367,987 Ordinary Shares, none of which are held in treasury.
Therefore, following Admission of the New Ordinary Shares, the total number of Ordinary Shares with voting rights in the Company will be 1,219,367,987, which may be used by Shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority’s Disclosure Guidance and Transparency Rules.
For further information, please contact:
|
Echo Energy Martin Hull, Chief Executive Officer
|
via Vigo Communications |
|
Vigo Communications (PR Advisor) Patrick d’Ancona Chris McMahon
|
+44 (0) 20 7390 0230 |
|
Cenkos Securities (Nominated Adviser) Ben Jeynes Katy Birkin
|
+44 (0) 20 7397 8900 |
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Shore Capital (Corporate Broker) Jerry Keen |
+44 (0) 20 7408 4090 |
Echo Energy #ECHO – New gas contract wins for 2021-2022 significantly above 2020 annual pricing and current spot price
Echo Energy, the Latin American focused upstream oil and gas company, is pleased to provide a commercial update regarding the Company’s gas sales from the producing Santa Cruz Sur assets, onshore Argentina.
The Company confirms that, following a successful auction process for industrial clients, it has secured two new gas sales contracts at significant premiums to both prevailing spot market rates and 2020 contracted rates (the “Contracts”).
The Contracts have a term of 12 months, with gas sales beginning in May 2021, and provide for a 126% increase over annual industrial contract pricing previously achieved by the Company in May 2020 and a 39% premium above current local spot price.
The Contracts provide gross 6.5 MMscf/d of committed production, 4.6 MMscf/d net to Echo, at an average price of $2.64 per mmbtu, with the Company able to elect to sell additional volumes of up to 1.9 MMscf/d net to Echo under the Contracts. This optionality, at the election of the Santa Cruz Sur partners, provides flexibility to respond to market conditions including rising spot prices.
As a result of the Contracts, a minimum of approximately 70% of gross daily gas production from Santa Cruz Sur allocated to industrial customers will now be committed under secured contracts until April 2022.
Martin Hull, Chief Executive Officer of Echo Energy, commented:
“We have previously commented on the improving market conditions for our business as commodity prices increase, and the Company’s ability to secure these new contracts with industrial customers via a competitive auction process reflects the increasingly supportive commercial environment. It is encouraging to now go further and see the improved market conditions translate to tangible improvements in future revenue We believe that as a result of these agreements, our contracted gas USD revenues for the year could be as much as [50] per cent higher when compared to May 2020 to April 2021, meaning they will deliver a material improvement in cashflow during 2021. We continue to pursue an innovative and flexible commercial strategy, enabling Echo to secure this type of premium pricing. These contracts also confirm that the Company is viewed as a reliable and attractive supplier to the Argentine industrial sector, and can achieve strong pricing for our output.”
For further information, please contact:
| Echo Energy
Martin Hull, Chief Executive Officer
|
via Vigo Communications |
| Vigo Communications (PR Advisor)
Patrick d’Ancona Chris McMahon
|
+44 (0) 20 7390 0230 |
| Cenkos Securities (Nominated Adviser)
Ben Jeynes Katy Birkin
|
+44 (0) 20 7397 8900 |
| Shore Capital (Corporate Broker)
Jerry Keen |
+44 (0) 20 7408 4090 |
Note
The assignment of Echo’s 70% non-operated participation in the Santa Cruz Sur licences is subject to the authorisation of the Executive Branch of Santa Cruz’s Province, which is part of the overall process of title transfer that is proceeding as anticipated. MMscf/d means million standard cubic feet of gas per day; and Mmbtu means million British thermal units.
The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as amended by the Market Abuse (Amendment) (EU Exit) Regulations 2019/310. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
Echo Energy #ECHO – Noteholder Meeting Results – 84% vote in favour
Echo Energy, the Latin American focused upstream oil and gas company, announces the results of the meeting of the holders of the Company’s Luxembourg listed EUR 20.0m 8.0% secured notes (the “Notes”) held earlier today (the “Noteholder Meeting”) to consider the Company’s proposals for the restructuring of the Notes (the “Proposals”).
Voting instructions representing EUR 12.5m of the Notes were lodged by holders of the Notes (“Noteholders”) with 84 per cent. of votes cast in favour of the Proposals.
With votes representing 62.5 per cent. of the aggregate principal amount of the outstanding Notes cast, the Noteholder Meeting was therefore adjourned for want of the necessary quorum and an adjourned Noteholder Meeting, to consider the Proposals in unchanged form, will now be held at 10.00 a.m. on 30 March 2021 (the “Adjourned Noteholder Meeting”).
The Adjourned Noteholder Meeting will require a reduced quorum of 25 per cent. of the aggregate principal amount of the outstanding Notes, being considerably lower than the 75 per cent. of the aggregate principal amount of the outstanding Notes that had been required for the Noteholder Meeting.
Voting instructions already lodged by Noteholders remain valid for the Adjourned Noteholder Meeting and the relevant Noteholders need take no further action to be represented at the Adjourned Noteholder Meeting.
In the event that current votes remain unchanged at the Adjourned Noteholder Meeting, the restructuring of the Notes would be approved as proposed by the Company.
A circular providing Noteholders with notice of the Adjourned Noteholder Meeting will be sent to Noteholders later today and will be available from the Company’s website at www.echoenergyplc.com shortly thereafter.
For further information, please contact:
|
Echo Energy Martin Hull, Chief Executive Officer
|
via Vigo Communications |
|
Vigo Communications (PR Advisor) Patrick d’Ancona Chris McMahon
|
+44 (0) 20 7390 0230 |
|
Cenkos Securities (Nominated Adviser) Ben Jeynes Katy Birkin
|
+44 (0) 20 7397 8900 |
|
Shore Capital (Corporate Broker) Jerry Keen |
+44 (0) 20 7408 4090 |
Note
The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.