Placement of 185m shares at A$0.10 raises about A$18.5m: about 120m shares now, about 65m subject to shareholder approval around 27 May. A share purchase plan up to A$10,000 per holder at A$0.10 follows. This is the planned funding step, diluting existing holders.
What it means for a shareholder
185m new shares at A$0.100 to raise about A$18.5m. That's 19% dilution: every existing holder's slice gets 19% smaller. If you held A$1,000 of shares (10,000 at the issue price), your slice goes from 0.00127% to 0.00103% of the company. To keep it you'd need 2,358 more shares - about A$236 at the issue price.
Both Bank of Scotland facilities (US$19.3m corporate, US$46m Maari) are fully drawn. A deal to roll half the corporate facility to 31 December 2009 awaits bank credit approval, with US$9.6m due before 30 June. Maari is producing 32,000 bopd gross and forecast to net about US$17m in 2009.
Presentation for a proposed raising of up to A$22m (220m shares at A$0.10): A$17m placement plus an estimated A$5m share purchase plan. Funds are for part-repaying corporate debt and PNG and China pre-development costs. This is the funding step flagged since the AGM.
Fellow Block 22/12 partner FAR sells its 5% interest to South Sea Oil (Majuko Group) for US$8m in tranches. Horizon keeps its 30%. CNOOC says it is ready to accept the new partner. Not Horizon's own transaction.
Maari: the two producers peak at over 26,000 bopd combined, so the first oil cargo is brought forward to the first week of April. Third well MR5P12 is being hooked up, and the rig is now drilling the first water injector.
Euroz conference presentation repeats known facts: Maari two wells flowing over 20,000 bopd combined, 61 mmbo 2P, and EBITDA of US$4.5m a month net at US$50 oil. Market cap is about A$88m at A$0.11 a share. No new information.
Maari: MR3P8 flows over 10,000 bopd on natural flow and MR4P9 started on 9 March with similar characteristics. Third well MR5P12 found about 1,800 m of oil sand, due on stream early April. First cargo is contracted for April.
Half-year to 31 December 2008 loss is US$10.0m, mainly Thai write-offs of US$6.8m. Cash was US$10.2m and borrowings US$58.5m. Company says it must undertake further asset sales and/or capital raisings to meet bank obligations, following the six-month Maari delay.
Partner Cue Energy reports first Maari oil flowed on 25 February 2009 from the first of five production wells. Horizon holds 10%. Cue expects about 35,000 bopd by end of third quarter 2009. Duplicates Horizon's own release.
First oil flows from Maari well MR3P8 to the FPSO Raroa, with two weeks of testing and commissioning ahead and first tanker offtake expected in April. This delivers the long-delayed first production; Horizon holds 10%, with 61 mmbbl 2P Moki volumes.
Maari: second well MR4P9 is completed with over 2,000 m of good oil-filled reservoir, to start flowing in the second week of March. First well MR3P8 is hooked up and about to flow first oil. 2P Moki volumes are 61 mmbbl.
Guidance that the half-year to 31 December 2008 will show a loss of about US$10m. Exploration write-offs and impairments of US$7.4–7.8m, mainly from the Thai exit, are the main cause. Finance costs are about US$0.8m.
13 Feb 2009asset acquisition disposition● NeutralMajor
Horizon transfers all its Gulf of Thailand interests (five blocks) to operator Pearl Energy, with no payment either way. This removes a 2009 drilling commitment estimated at US$22–30m net and brings a US$6.8m impairment. It reverses the 2008 Thai expansion, which the CEO links to delayed Maari cash flow and low oil prices.
December quarter: first Maari well is completed with production due late February. The Block 22/12 plan is modified to cut costs, with resubmission now May 2009. A PNG technical review was positive. Horizon is seeking to farm out or sell its Thai acreage to cut spending.
Maari: first production well MR3P8 is completed with a 1,518 m horizontal section in clean oil-bearing sandstone. It will be hooked up, with production to the FPSO expected late February. The rig moves to the second well.
Maari: surface holes for the first three production wells finished on 24 December. The first well, MR3P8, was drilling at 1,532 m. First oil is still expected around mid-February 2009.
Maari: 24-inch conductors completed in nine slots ahead of schedule. The rig is preparing to batch-drill the first three production wells. First oil is still expected around mid-February 2009.
AGM chairman's address acknowledges the financial crisis, oil near US$50–55 and Maari cash delayed to Q2 2009. Maari cash flow is expected to reach about US$4.5m a month by August 2009, down from the earlier US$8m a month at US$80 oil. Financing plans run to Q3 2009.
Board withdraws AGM resolutions on a higher director fee pool and options for a non-executive and two executive directors. It cites the falling share price, falling oil price and Maari cash inflows delayed until early 2009.
Maari: ten 30-inch stove-pipes installed ahead of schedule; 24-inch conductors next, then the first three production wells. First oil is still expected around mid-February 2009. Progress is as planned.
Maari partner Cue Energy repeats the rig positioning news and says first oil is expected around mid-February 2009, once the first development well is completed. Horizon holds 10%. Duplicates Horizon's own release.
Ensco 107 rig is finally positioned beside the Maari platform after prolonged weather delays. Development drilling of 5 oil and 3 water injection wells begins, with first oil about three months later. This ends the weather wait noted in earlier reports.
September quarter: Maari rig still waiting on weather to start drilling; PEP 38494 farm-in completed. The Block 22/12 development plan slips from September to end-2008. Thai drilling is delayed to February 2009.
2008 Annual Report and notice of AGM on 27 November 2008. The report notes Maari first oil is delayed by weather and Horizon's share of Maari cost to completion is up 44% to US$52.4m. Repeats known events.
Stanley (PNG) plan shifts to a larger gas recycling and condensate stripping project: 140 mmcfd from two wells, over 4,000 bpd condensate, over 8 mmbbl over 10 years. Stanley 2P gas is 260 bcf. Ok Tedi power supply now doubtful; a decision awaits Stanley-2, with start-up possible in 2010.
CEO presentation at the Good Oil Conference repeating known assets. It gives cash of US$10.5m and shows Maari first production slipping to November 2008 (previously October). Market capitalisation is about A$268m. No new announcement.
Horizon farms into New Zealand permit PEP 38494 (southern Taranaki, 5,341 sq km) with operator Todd Energy, earning 25% by funding 37.5% of the first well, probably on the Matariki prospect around mid-2009. The carry is capped at an agreed amount. It extends Horizon's Maari-area position.
Preliminary results for year to 30 June 2008: cash US$19.6m, Maari 80% complete with first production scheduled October 2008, and PRL 4 now 100%. Block 22/12 investment decision is due September 2008. Thai first-phase drilling begins November. Financial detail truncated.
Full annual financial report for the year to 30 June 2008, restating the PNG purchases (US$10.0m total, 100% of PRL 4 and 49.647% of PRL 5), the Thai farm-in, the A$14.2m placement, option exercises and the extra US$25m BOSI debt facilities. Repeats known events.
June quarter: Maari installation essentially complete with development drilling about to start and first wells expected on stream in October. Block 22/12 development plan to be filed by 30 September. Stanley-1 test flowed over 30 mmcfd; Thai drilling due November.
