Misen Energy AB (publ) signs new amendment to Joint Activity Agreement
In May 2015, Misen Energy AB (publ) received a final approval from the Ukrainian State authorities with regard to the Amendment No.7 to the Joint Activity Agreement (“JAA”) that was signed by the Joint Activity (“JA”) participants in late March 2015. The Amendment No.7 alters the scope of the JAA and adjusts and extends implementation of the investment program agreed by the parties of the JA.
The key modifications of the JAA as agreed by the Amendment No.7 are:
- Seven projects have been excluded from the investment program, making the total number of the investment projects under the JAA 15.
- Eleven projects have been reviewed and their investment programs have been adjusted and rescheduled.
- Four projects remain unchanged.
- Due to decreased scope of the JAA, the total amount of the investment program has been reduced to MUSD 571.
- The implementation of the investment program has been extended till 31 December 2018.
Among the principal changes made to the JAA, the following specific items may be noted:
- The total number of well workovers has been reduced to 110 (from previously planned 145);
- The total number of Booster Compressor Stations (“BCS”) to be constructed under the JAA has been reduced to 12 (from previously planned 13);
- Misen Enterprises AB’s commitment to facilitate additional financing to JA, when required, has been agreed to stay at the original amount of UAH 3 billion (approximately SEK 1.2 billion at the current exchange rate);
- Additional fields have been included into the operations of Khrestyshchenska BCS, yielding an increase to net production volumes attributable to the JA;
- Construction of additional supporting infrastructure has been agreed at Khrestyshchenska BCS to facilitate extraction of propane, butane and gas condensate fractions.
By a separate protocol, the Management Committee of the JA agreed to extend the Misen Enterprises AB’s obligation to contribute KUSD 12,516 (KSEK 80,685) to the JA till 31 December 2015.
For further information, please contact:
Göran Wolff, MD
Misen Energy AB (publ) is a Swedish upstream oil and gas company with operations in Ukraine. The company was founded in 2004 and its shares are since 12 June 2007 traded on Nasdaq Stockholm First North.
In 2011, Misen Energy AB (publ) acquired Misen Enterprises AB and its Ukrainian subsidiary, LLC Karpatygaz, including the rights to 50.01% of the revenue and profit from a gas production project in Ukraine. Under IFRS rules, this transaction is classified as a reverse takeover. In consideration of the acquisition, a new share issue was carried out.
The gas producing assets have been acquired by production cooperation via a joint activity project governed by a Joint Activity Agreement between the wholly-owned direct and indirect subsidiaries of Misen Energy AB (publ), i.e. Misen Enterprises AB and LLC Karpatygaz (together 50.01%) and PJSC Ukrgasvydobuvannya (49.99%), the largest producer of natural gas in Ukraine and subsidiary of the National Joint Stock Company Naftogaz of Ukraine. The value of the assets is estimated to be substantially higher than the purchase price for Misen Enterprises AB.
The purpose of the project is to significantly increase production of gas and oil by providing modern technologies via a large-scale investment program. The registered office of Misen Energy AB (publ) is in Stockholm and the shares are traded on First North under identification ticker MISE.
The Certified Adviser of the company at Nasdaq Stockholm First North is Consensus Asset Management AB.
For further information, please visit our website www.misenenergy.se.