| APRIL 2001- RELEASES |
| DRILLING ACTIVITY UPDATE (27-04-01) |
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1. APPRAISAL DRILLING 1.1 UK Onshore: Eskdale-13, Licence PEDL002 (ROC: 5% free carried) Preparations to test the Kirkham Abbey Limestone reservoir target are continuing. 1.2 UK North Sea: Chestnut Oil Field, Licence P354 (ROC: 14.875% carried) Since 19 April 2001, 12 1/4" hole was drilled to 2,983 meters and the 9 5/8" casing was set and cemented. Current operations, at 0600 hrs local time 26 April 2001, is preparing to clean out the casing prior to drilling an 8 1/2" horizontal hole through the Nauchlan reservoir section. 2. DEVELOPMENT DRILLING 2.1 UK North Sea: Kyle Oil Field, Licence P748 (ROC: 12.5%) Since coming on stream on 7 April 2001, provisional production from the Kyle Oil Field to 25 April 2001 was 308,452 barrels at a rate of 17,136 BOPD (2,142 BOPD net to ROC). Daily production has peaked at rates above 25,000 BOPD (3,125 BOPD net to ROC). Dr
John Doran Return to ASX Releases main page
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| GULFSTREAM OFFER UPDATE (23-04-01) |
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NEWS RELEASE ROC
SAYS GULSTREAM TRYING TO MAKE NEWS OUT OF OLD INFORMATION
In a press release dated April 19, 2001, Gulfstream advised that "…agreement has been reached with Qatar Petroleum to proceed with the development of the Al Rayyan oilfield offshore Qatar … Development of the field will involve installation of new platform processing facilities and raising the production profile to between 25 and 35 thousand barrels per day…" Commenting on the press release, Dr. John Doran, Chief Executive Officer of ROC, said: "Gulfstream has presented its announcement as if it is a news event. Gulfstream shareholders should be cautious in treating Gulfstream's announcement as a 'new event' that adds value to the company. We see nothing here that is of any additional value. In fact, Gulfstream states on page 11 of their 2000 annual report, published February, 2001, that 'Production is to be brought up quickly to 35 thousand barrels per day from the replacement platform with the addition of six wells'. "In our mind the issue has never been whether the new production profile would be approved, but rather, how is Gulfstream going to meet its share of capital commitments? What is surprising about the Gulfstream announcement is what it does not say - i.e. where is the money going to come from to finance Gulfstream's heavy capital expenditure program?" ROC's offer to acquire 40% of Gulfstream's issued and outstanding common shares is open for acceptance until 6.00 p.m. (Calgary time) on Tuesday, May 8, 2001, unless withdrawn or extended. ROC is an Australia-based energy company with oil and gas interests in the United Kingdom, Australia, West Africa and selected regions of Asia. For the fiscal year ended December 31, 2000, the Company reported cash flow of C$43 million on gross sales revenue of C$70 million, C$43 million in cash on hand and year-end assets of C$229 million. Contact: Roc Oil
Company Limited
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| ACTIVITY UPDATE (20-04-01) |
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1. EXPLORATION 1.1 Offshore Mauritania: Drilling commencement - Chinguetti 1 Shareholders should be aware that drilling operations are under way at Chinguetti 1 and that when this well is completed a second well, Courbine 1, will be drilled by the operator Woodside. The wells are located in the offshore Mauritania Areas referred to as A and B (Blocks 3, 4 and 5). ROC is entitled to acquire equities of 2.7% and 2.4% respectively in these Areas (in addition to equities of 2.5% in Area C and 2.0% in Area D) as a result of an option arrangement entered into with the shareholders of Elixir as detailed in ROC's announcement to ASX dated 14 April 2000. Because ROC has not yet exercised its option it does not have a direct interest in the current well and therefore it is not ROC's intention to issue weekly updates with regards to the drilling operation, which ROC presumes will be provided by the other participants listed on ASX.
A completion string has been run at the Eskdale-13 appraisal well and preparations are being made to test the Kirkham Abbey Limestone reservoir target. 2.2 UK North Sea: Chestnut Oil Field, Licence P354 (ROC: 14.875% carried) Following unsuccessful attempts to land 9-5/8" casing at 2,970 metres, a cement plug was set and a sidetrack well, 22/2a-11Y, kicked off from top of cement at 2,373 metres. Current operation, at 0600 hrs local time 19 April, is waiting on weather after drilling to 2,483 metres. Forward plan is to drill ahead and set 9-5/8" casing and then drill an 8-1/2" horizontal hole through the Nauchlan reservoir section to a total depth of beyond 3,650 metres.
3. DEVELOPMENT 3.1 UK North Sea: Kyle Oil Field, Licence P748 (ROC: 12.5%) After coming on stream on 7 April, commissioning and calibration tests have been carried out on both producing wells and on facilities. These tests have now been completed and the field is on steady production via the Curlew FPSO at approximately 20,000 bopd (ROC 2,500 bopd). Plans
are progressing to spud the next Kyle Development Well by early June.
The well will target oil in Paleocene sands above the Upper Cretaceous
chalk reservoir being produced by the 2 wells currently on stream. If
successful, the well is expected to be on stream by October 2001. Dr
John Doran Return to ASX Releases main page
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| GULFSTREAM OFFER UPDATE (19-04-01) |
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NEWS RELEASE ROC
COMMENTS ON GULFSTREAM'S CALGARY,
April 18, 2001 - Roc Oil Company Limited (ASX:ROC) ("ROC") today
commented on Gulfstream Resources Canada Limited's (TSE:GUR) ("Gulfstream")
Directors' Circular filed on April 17, 2001 (the "Directors' Circular")
and recent share price movements. SUMMARY Dr. John Doran, ROC's Chief Executive Officer, said, "The Gulfstream board has provided little in the way of substantive guidance to its shareholders but, importantly, the directors do not advise Gulfstream shareholders to reject ROC's offer. The Directors' Circular also reveals the provision for more than C$7 million in payments to two senior directors in the event that they resign or their employment is terminated after a party has acquired more than 15% of the company. This amount is in excess of five times Gulfstream's net income and approximately equal to its cash flow for its 2000 fiscal year. It also represents more than 15% of the market capitalization of Gulfstream prior to the announcement of ROC's offer.
· Gulfstream's Directors' Circular does not recommend that ROC's Offer be rejected; rather it advises shareholders to wait for further information. · The Directors' Circular acknowledges Gulfstream's need for additional capital to meet its ongoing commitments, but also states that Gulfstream has not entered into any transaction in this regard nor are there any negotiations underway that would result in a material change to Gulfstream. · Gulfstream's Chairman and one other key director expect to receive more than C$7 million cash in the event of termination or resignation if any party acquires more than 15% of the company. This figure is more than five times Gulfstream's net income and approximately equal to its cash flow for its 2000 fiscal year. Dr. Doran stated that "Unless these termination payments are substantially reduced and/or Gulfstream can demonstrate additional value within its portfolio of assets, ROC reserves the right to withdraw its offer or to reduce the offer price to reflect the onerous burden which these payments represent." · Gulfstream's recent exuberant share price, driven by speculation not substance, represents market noise not shareholder signal. During the two weeks which have elapsed since ROC announced its offer to acquire 40% of the stock, less than 2% of Gulfstream has changed hands at prices above the C$1.10/share cash offer price. · The Gulfstream Directors' Circular reaffirms the Company's intention to leave the Shareholders' Rights Plan in place. This inaction jeopardizes their own shareholders' ability to decide for themselves whether or not they want to accept ROC's offer. · True to ROC's sensibly contrary business philosophy, the Company will not knowingly pay more than it believes an asset is worth. Based on our positive track record, our potential to add value to Gulfstream's assets, particularly in Qatar, and our analysis of information in the public domain, we believe our offer represents full and fair value to Gulfstream shareholders. ROC's offer is not an opening bid."
· Gulfstream's directors further state that they are yet to a reach a conclusion regarding the financial adequacy of ROC's offer and that, in their view, it is not yet appropriate to seek a formal opinion from Gulfstream's financial advisors, CIBC World Markets, as to the financial adequacy of ROC's offer. ROC finds it strange that Gulfstream is unable to provide guidance to its shareholders as to the value of its assets given that all of its newly acquired interests represent additional working interests in existing blocks. Furthermore, Gulfstream's 2000 Annual Report discloses the price the company paid for these additional interests. · The Directors' Circular also publicly reveals, for what appears to be the first time, specific details of the termination/resignation arrangement with respect to the two key directors. Specifically, Mr. J. Angus McKee, Chairman, presently stands to receive in excess of US$3 million (C$4.7 million) if his employment is terminated, or if he chooses to resign, after the acquisition by any party of more than 15% of Gulfstream. This equates to more than 14 years salary based on Mr. McKee's published salary for the fiscal year ended September 30, 2000. In the same context, Mr. Roger A. Haines, director, stands to receive in excess of US$1.5 million (C$2.3 million) which is equivalent to more than 11 years salary based on Mr. Haines' published salary for the fiscal year ended September 30, 2000. Collectively, Messrs. McKee's and Haines' resignation/termination payments equate to more than 15% of Gulfstream's recent market capitalization before the announcement of ROC's offer. · Four pages of the 17 page Directors' Circular are devoted to the Gulfstream Shareholders' Rights Plan which the directors presently intend to leave in place. In view of this inaction, ROC will review its options for ensuring that Gulfstream shareholders are given the opportunity to make their own investment decisions with respect to ROC's offer. 2. Gulfstream's Recent Share Price Movements · The Directors' Circular tries to focus attention on the fact that Gulfstream's share price recently reached a high of C$1.70. The Directors' Circular does not point out that this has been achieved on very thin trading, with less than 2% of the outstanding Gulfstream shares trading at prices above ROC's cash offer price of C$1.10 per share. · Neither does the Directors' Circular mention that the trading which has occurred at these recent high prices has involved investment dealers who seemingly do not have a well established prior trading history in the stock and who may, therefore, be more influenced by short-term speculation rather than by the stock's fundamental value. In these circumstances, the target company's share price often rises initially - only to fall back in the absence of a higher alternative offer. · The Directors' Circular demonstrates that there has been no increase in Gulfstream's fundamental value since ROC's offer was announced on April 2, 2001. In fact, the revelation about the magnitude of the two key directors' termination/resignation payments - a detail that, in apparent contravention of securities law disclosure requirements, has seemingly never been previously disclosed - would suggest that the perceived value of Gulfstream has dropped by more than C$7 million (C$0.11 per share). 3. Comments from ROC's CEO Commenting on the evolving situation, ROC's Chief Executive Officer, Dr. John Doran, stated that: "ROC welcomes the acknowledgement by Gulfstream's Board that the process of corporate change triggered by ROC's bid is now irreversible. "Subject to specific details, ROC would also welcome a refinancing of Gulfstream because, as the directors of Gulfstream have now publicly acknowledged, the company needs additional capital to meet its ongoing commitments. In these circumstances, it is important that Gulfstream's assets are protected. "If Gulfstream's directors are really serious about their desire to enhance shareholder value, they will be quick to provide ROC with the same access to non-public data as may be provided to any other interested party in the future. If the Gulfstream directors genuinely believe that the fundamental value of the company exceeds ROC's offer price, they will provide this access without any concern that ROC may withdraw its offer after reviewing Gulfstream's technical and financial details which have not been disclosed to the market. "As far as a potential White Knight is concerned, ROC's attitude is that if any credible industry participant can be enticed to make an offer at anywhere near recent trading prices, we wish them the best of luck. "Since announcing its offer on April 2, 2001, ROC has effectively been cast in the role of a White Knight for Gulfstream shareholders. This is evidenced by the new-found focus which Gulfstream's directors now claim to have with regard to realizing shareholder value. This, together with ROC's shareholder base in Qatar, strongly suggest that ROC is well qualified for such a role. Certainly, ROC has already been the catalyst for increasing Gulfstream shareholder value and providing all investors with new insights into how Gulfstream is managed. "A lot of adjectives could be used to describe Messrs. McKee's and Haines' termination/ resignation arrangements, but they would all be superfluous because the magnitude of the corporate largesse speaks for itself. Now that the numbers have been brought into the public domain, Gulfstream shareholders can decide for themselves as to how appropriate it is for a company of Gulfstream's size, financial standing and historical performance to enter into such arrangements. As far as ROC is concerned, the termination payments confirm the unease we had regarding the possible size of these payments which do not appear to have been specified previously and which underscore our rationale for including the relevant condition in our offer document." ROC's offer to acquire 40% of Gulfstream's issued and outstanding common shares is open for acceptance until 6:00 p.m. (Calgary time) on Tuesday, May 8, 2001, unless withdrawn or extended. ROC is an Australia-based energy company with oil and gas interests in the United Kingdom, Australia, West Africa and selected regions of Asia. For the fiscal year ended December 31, 2000, the Company reported cash flow of C$43 million on gross sales revenue of C$70 million, C$43 million in cash on hand and year-end assets of C$229 million.
Roc Oil
Company Limited
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| DRILLING ACTIVITY UPDATE (12-04-01) |
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1. APPRAISAL DRILLING
1.1 UK Onshore: Eskdale-13: (ROC: 5% free carried)
The
sidetrack hole is a depth of 2,970 metres and is been conditioned prior
to running and cementing the 9 5/8 inch casing following which an 8 ½
inch horizontal hole will be drilled through the reservoir section to
a total depth of beyond 3,650 metres. 2. DEVELOPMENT 2.1 UK North Sea: Kyle Oil Field (ROC: 12.5%) During the first four days of production the Kyle Oil Field flowed at rates up to 20,000 BOPD. (Net ROC: 2,500 BOPD). The first lifting of Kyle oil is expected to take place prior to the end of April. Dr
John Doran Return to ASX Releases main page
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| CEO ON GULFSTREAM OFFER (10-04-01) |
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Below is a transcript of interview ROC's CEO had with corporate.com OPEN BRIEFING - ROC's CEO ON GULFSTREAM OFFER Record of interview: corporatefile.com Roc Oil Company Limited, ("ROC") announced last week a cash offer to acquire 25.75 million shares in Toronto-listed Gulfstream Canada Resources Limited ("Gulfstream") at C$1.10/share, representing 40 percent of the issued share capital of that company. This will cost ROC A$39 million including transaction costs. The offer price represents a premium of 51 percent to the weighted average of Gulfstream's share price during the 10 trading days prior to the offer. What justifies a price of A$39 million for 40 percent of Gulfstream? CEO John Doran Gulfstream's published information indicates that, if successful, this deal would substantially lift ROC's reserve base. As at December 31, 2000 ROC's onshore UK and UK North Sea oil, gas and condensate recoverable proved and probable (2P) reserves totalled 33.6 MMBOE. If the offer is successful, ROC's 2P oil and gas reserves would increase to more than 50 MMB of oil and about 250 BCF of gas. The Gulfstream asset where we expect to realise most of the value to justify the offer price is the 65 percent stake in the Al Rayyan Oil Field in Qatar. The Middle East is a part of the world in which we feel comfortable. We have examined several investment opportunities in that region. This trail of investigation led us to Gulfstream. A successful bid will give ROC a very focused presence in the Middle East. corporatefile.com ROC's share price has under-performed since it publicly listed in August 1999, so why do you think you can create wealth for the Gulfstream shareholders? CEO John Doran We can't forecast, let alone guarantee, what Gulfstream's share price will do in the future because that depends upon specific corporate performance and the state of the capital markets, particularly the energy sector. In ROC's case, our IPO coincided with a delay to the start-up of oil production from the Kyle Field in the North Sea, due to reasons well beyond the control of the operator, Ranger Oil. The problem related to a third party facility servicing another oil field. Many Canadian investors will be aware of the corporate frustration caused by the Kyle delay, not only in the context of Ranger but also with regard to Bow Valley Energy. However, during the twelve month period prior to the announcement of ROC's offer to Gulfstream shareholders, ROC's share price out-performed, by about 42 percent, the informal composite index represented by its Australian peer group. It also out-performed Gulfstream's share price by a margin of 82 percent. Regardless of what the share price has done, ROC's financials illustrate that fundamental value has been added to ROC since its public listing. corporatefile.com It seems unusual to bid for only forty percent of Gulfstream? CEO John Doran Forty percent of Gulfstream provides the right balance for ROC's portfolio. Also, we are a prudent company. Our analysis relies entirely on public data so that, if our offer is successful but we find some unexpected surprises, we will be able to handle the consequences at a 40 percent ownership level. We are informed that partial bids seeking 40 percent of the target company are fairly unusual in Canada because that equity level would not allow the bidding company to consolidate the accounts. However, our bid structure will allow ROC to consolidate Gulfstream's accounts under Australian legislation. corporatefile.com Are there any other aspects of this transaction that are unusual? CEO John Doran The process we are undertaking is well established but there are some aspects which are perhaps a little unusual. The relevant legislation in Canada was changed as of 1 April 2001 and therefore, I think, our bid is the first one to be launched under the new legislation. corporatefile.com How hostile is the bid? CEO John Doran The bid is certainly unsolicited but it is designed to be friendly to Gulfstream shareholders. A 51 percent cash premium to the pre-bid trading average certainly falls within our definition of friendly. corporatefile.com Are there any similarities between this deal and ROC's acquisition of Morrison Middlefield Resources Limited ("MMRL") in 1999? CEO John Doran MMRL was also listed on the Toronto Stock Exchange and also had most of its assets located outside Canada. That, however, was a negotiated deal conducted under a Plan of Arrangement. The MMRL transaction turned out to be very good for both ROC and MMRL shareholders and we hope the Gulfstream transaction will prove to be just as good, or even better. corporatefile.com What has been Gulfstream's earnings record and what is the outlook? CEO John Doran Based on public data, Gulfstream's earnings record has been subdued. Net income was just over C$1 million last year. Eventually, the earnings potential should be quite good - but not in the near term where it seems that quite a lot of work is needed to restructure Gulfstream's finances. Future project development would appear to be cash constrained, subject to any refinancing which we expect to happen. Gulfstream is not expected to generate a lot of discretionary cash in the short term but that's OK because ROC has a relatively robust cash flow from its UK properties and no net debt. In the short term, we don't need access to Gulfstream's cash flow; it's our reserve base which needs to be strengthened. corporatefile.com How then do you plan to maximise the value of your investment? CEO John Doran In these situations it is easy to promise too much and deliver too little. We don't want to fall into that trap. Turning around Gulfstream's fortunes is not going to be easy. However, ROC and before that, Command Petroleum, have a credible track record of adding value to under-performing assets. We did it in Papua New Guinea in the early nineties; India in the mid nineties and onshore UK in the late nineties. We want to continue this sequence with Gulfstream. We would bring to Gulfstream a different corporate culture and a different attitude to corporate governance. corporatefile.com Would you withdraw your offer if Gulfstream successfully refinanced the company? CEO John Doran ROC would not necessarily withdraw its offer, particularly if the refinancing was designed to protect and preserve the assets. A refinancing would be the first item on our agenda if our offer is successful and there has been no announcement from Gulfstream about the refinancing of the company during the course of the offer. corporatefile.com If the offer is successful, the cash outlay by ROC will be A$39 million, including transaction fees. All of the purchase price will be funded from ROC's cash reserves. What will be ROC's net cash position after the transaction? CEO John Doran ROC should have about A$20 million in cash after it pays Gulfstream shareholders in May 2001. Our current cash balance is in excess of A$70 million. The purchase price for Gulfstream is just over 60 percent of the A$62 million ROC received as the result of selling its non-core onshore U.K. oil properties in March 2000. corporatefile.com What oil and gas sales growth do you forecast from the Al Rayyan Field? CEO John Doran Based on public data, the Al Rayyan Oil Field is expected to be producing in excess of 25,000 barrels a day by the end of next year, subject to a successful development and OPEC quotas. That's more than 16,000 BOPD net to Gulfstream, before government royalties etc. corporatefile.com BP, the operator of Al Rayyan, seemed to take a long time to formalise its commitment to expand the field. Are you confident the project will move smoothly to the higher production level? CEO John Doran From what I understand from public data, I actually think BP moved rather quickly. Don't forget, BP's takeover of Arco did not become effective until April of last year and the plan to develop the field was submitted around October last year. That's not a great deal of time for a new owner to come to grips with an asset. All the public data indicate that BP and the other joint venturers, are proceeding with the expansion of the field and that the field will be brought into production within the scheduled timeframe. corporatefile.com Currently ROC is focused in the UK. Why are you now comfortable in owning assets in Qatar? CEO John Doran Qatar is not a new country for us. I've been visiting the country for a number of years. In fact, my first contact with our Qatari advisor to the ROC board was in the early nineties. Our Qatari shareholders are senior members of that country's business community. ROC has clearly stated in its various ASX releases that the Middle East is one of five areas in the world where we want a presence. Qatar is an excellent starting point for ROC's Middle Eastern ambitions. corporatefile.com Can you achieve your Gulfstream aims with less than 100 percent of the company? CEO John Doran Absolutely. Even by owning 40 percent, with the right board structure, both Gulfstream and ROC shareholders can look forward to some significant wealth creation in the medium to longer term. In the short term, we've got plenty going on elsewhere in our portfolio to reward ROC shareholders. corporatefile.com You are seeking three board seats out of five. Can you achieve board control while only bidding for 40 percent of the company? CEO John Doran That's for the Gulfstream shareholders to decide, but we are advised that, in Canada, it is not uncommon for a 40 percent shareholder to be represented by a small majority of the directors. If ROC's nominees are elected to the board of Gulfstream, those individuals will be very mindful of their fiduciary duty to all Gulfstream shareholders and will always operate in the best interests of all Gulfstream shareholders. corporatefile.com Your offer is subject to a number of caveats, all of which have to be satisfied or waived at your discretion in order for the offer to be consummated. What are these caveats? CEO John Doran There are about 17 caveats in all and they are detailed in the formal Offer Document on ROC's website, (www.rocoil.com.au). Some of the caveats are standard industry conditions and some are tailored specifically to the Gulfstream situation. For example, we are suggesting that the key Gulfstream management contracts are made public so that everyone can judge whether the termination payments are appropriate. corporatefile.com Can you please explain how the presence of a "Shareholders Rights Plan" for Gulfstream may act as a poison pill to the deal? CEO John Doran As I understand it, the Shareholders Rights Plan is triggered the moment anyone acquires more than 20 percent equity. Existing Gulfstream shareholders - other than the bidding party - are then effectively able to acquire Gulfstream shares, through a new issue, at half the market price. This would represent an enormous dilution for the bidding company. We are advised that the correct process is to ask Gulfstream directors to remove the plan. In ROC's opinion, it would be unthinkable that the shareholders of Gulfstream could be denied the opportunity to accept ROC's offer because of the existence of what is, in effect, a poison pill. corporatefile.com Is the removal of the Shareholders Rights Plan one of your 17 caveats? CEO John Doran Absolutely. corporatefile.com What are the prospects for signing gas sales agreements for the discoveries Gulfstream holds in Oman (Gulfstream 100%) and Madagascar (Gulfstream 80%)? CEO John Doran We are tempted to view Oman as more of an appraisal project. Gulfstream has made some very positive statements about Oman but it is something that will be looked at it in more detail when we acquire the 40 percent stake. We view Madagascar as an exploration project and it's too early to make any comment about its commercial potential. corporatefile.com What's the next step in the offer process? CEO John Doran We mailed our offer directly to Gulfstream shareholders earlier today. Between now and 17 April we expect Gulfstream to publish its response to our offer. We would also expect Gulfstream to make some public comment on the state of its finances, because the published material suggests that this is one of the company's more pressing issues and we assume that the incumbent management are dealing with it. corporatefile.com So what's your biggest worry now that the bid process is under way? CEO John Doran We enjoy a lot of direct contact with our own shareholders and we would welcome similar contact with Gulfstream shareholders if only to ensure that they are fully informed about our proposal. We're also concerned that the offer will not even reach the shareholders should the Gulfstream Board decide to act in a manner that prevents one or more of the various caveats from being satisfied. corporatefile.com What will you do if your bid fails? CEO John Doran It would be presumptuous to assume the bid will be successful because its fate lies entirely in the hands of Gulfstream shareholders. We will be extremely disappointed if our offer fails because of the potential benefits a successful offer will bring to both ROC and Gulfstream shareholders. However, the oil and gas sector is a very busy industry at the moment and if we don't succeed we'd get to keep the money in the bank and go and look for something else - but with a huge regret for the opportunity loss suffered by both sets of shareholders. corporatefile.com Thank you John. We look forward to the next Open Briefing with ROC. Dr
John Doran |
| UPDATE (10-04-01) |
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ROC MAILS OFFER TO GULFSTREAM SHAREHOLDERS $1.10
in cash per share provides large premium
As announced on April 2, 2001, the all-cash Offer of C$1.10 per share represents a 51% premium to the weighted average trading price of Gulfstream shares for the 10 days preceding ROC's announcement. The Offer will be open for acceptance until 6:00 p.m. (Calgary time) on Tuesday, May 8, 2001, unless withdrawn or extended. Dr. John Doran, Chief Executive Officer of ROC said, "We are providing this information as quickly as possible so that Gulfstream shareholders will be well placed to make an informed decision on our Offer. We regret that Gulfstream's Board has adopted delaying tactics to frustrate ROC in its attempts to mail the Offer to Gulfstream shareholders in short order. Despite these tactics, ROC has been able to secure a shareholders' list directly from the trust company in order to ensure that all Gulfstream shareholders are provided with a copy of the Offer in advance of when they would have otherwise received the Offer. "Under the new rules governing such transactions, the 35-day offer period commenced on April 2, 2001, the day our Offer was announced. In this context, Gulfstream's inaction, with regard to providing the shareholders' list, only serves to narrow the window in which its own shareholders will receive and act upon our Offer so that they, rather than the Board alone, can determine the future of their company. "Gulfstream shareholders have the opportunity to monetise 40% of their shareholding now, at a 51% cash premium to the share price which prevailed before the Offer was announced while still participating, through the retention of the majority of their shareholding, in the upside potential that ROC will strive to realize by working with all other Gulfstream shareholders. We also invite Gulfstream shareholders to consider ROC's proven track record, our attitude to corporate governance and the experience of our directors and advisors, particularly in the Middle East. Incorporated in 1996, ROC is an Australia-based energy company with oil and gas interests in the United Kingdom, Australia, West Africa and selected regions of Asia. For the fiscal year ended December 31, 2000, the Company, reported cash flow of C$43 million on gross sales revenue of C$70 million, C$43 million in cash on hand and year-end assets of C$229 million.
Roc
Oil Company Limited Raymond James Ltd
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| UPDATE (09-04-01) |
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·
KYLE OIL FIELD STARTS PRODUCTION
ROC is pleased to advise that the Kyle Oil Field, located in Block 29/2c in the UK North Sea, commenced production at 2.30am on Saturday 7 April 2001 (UK time). Production is expected to stabilise at a rate in excess of 16,000 BOPD (net ROC: >2,000 BOPD). The oil is being processed, together with oil production from the Curlew Field, by the Maersk Curlew Floating Production Storage and Off-loading (FSPO) facility which is located approximately 18 km to the south of Kyle. Gas will be transported through the SEGAL system. Initial Kyle production is from two wells and the Joint Venture plans to drill a further one or two wells during the balance of 2001. Commenting on the start-up of production from Kyle, ROC's CEO Dr John Doran stated that: "Kyle represents another significant boost to ROC's net production profile, moving it towards 9,000 BOEPD, Kyle will also provide the Company with a better oil-gas production balance". 2. A$5.5MM BONUS RELATING TO 2000 SALE OF NON-CORE UK ASSETS Consistent
with the agreement with Star Energy Limited ("Star"), detailed
in ROC's release to ASX dated 2 May 2000, Star has paid to ROC £1.9
million/A$5.5 million representing the first twelve month "Bonus
Payment" which is based on production rates and oil prices. The payment
of this bonus brings the total sale proceeds from last year's sale of
ROC's non-core UK assets to A$62.5 million, compared to the initial payment
of A$57 million. Subject to oil price and production rates over the next
twelve months ROC is eligible to receive a second bonus payment, up to
a maximum of £3 million, in March 2002. Return to ASX Releases main page
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| UPDATE (06-04-01) |
1. APPRAISAL DRILLING 1.1
UK Onshore: Eskdale-13: (ROC: 5% free carried) 1.2 UK North Sea: Chestnut Oil Field (ROC: 14.875% carried) As of 5 April 2001, (UK time), the Chestnut Field appraisal well, 22/2A-11 (sidetrack), in UK North Sea licence P 354, had reached a depth of 2970 meters and again encountered Nauchlan reservoir sand. Forward programme is to run and cement a 9 5/8 inch casing liner at the current depth prior to drilling on into the reservoir. 2. DEVELOPMENT 2.1 UK North Sea: Kyle Oil Field (ROC: 12.5%) Final preparations are continuing for the start of full-scale oil production from the Kyle Field via the Curlew Field's floating production facilities. There have been minor schedule delays, primarily related to weather, and first oil is now expected to flow in the next few days. 3. SEISMIC 3.1 Equatorial Guinea: Rio Muni Basin (ROC: 60% and Technical Partner) The 100% ROC-funded, 1380 sq km, 3D seismic survey in Blocks H15 and H16 in the deep water offshore Equatorial Guinea was completed on 30 March. Dr
John Doran |
| UPDATE (03-04-01) |
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ROC
TARGETS 1. THE OFFER Roc Oil (Middle East) Pty Limited (Roc Middle East), a wholly owned subsidiary of ROC, hereby advises that it has made a cash offer to acquire 25.75 million shares of Toronto-listed Gulfstream, representing 40% of the issued share capital of that company. The relevant details of the offer are: · The offer price, C$1.10/share, equivalent to A$1.43/share , implies a total market value for Gulfstream of C$71 million/A$92 million and represents a 51% premium to the weighted average of Gulfstream's share price during the last 10 trading days. (Attachment 1) illustrates Gulfstream's share price performance since it was restructured in 1993. · If the offer is successful, Roc Middle East will be Gulfstream's largest shareholder by a considerable margin, because no Gulfstream shareholder is currently registered as owning more than 10% of the company. · In the event that the offer is successful, the cash outlay by Roc Middle East will be C$30 million/A$39 million, including transaction fees. This equates to just over 60% of the proceeds of ROC's March 2000 sale of its non-core onshore UK oil assets. All of the purchase price will be funded from ROC's internal cash resources, the bulk of which is held in United States Dollars and British Pounds. · The offer, which has not been solicited by Gulfstream's Board, is subject to a number of caveats, all of which will need to be satisfied or waived, at Roc Middle East's sole discretion, in order for the offer to be consumated. These caveats reflect the fact that ROC's analysis of Gulfstream has been necessarily based entirely on data in the public domain. Among many other caveats Roc Middle East acknowledges the presence of a "Shareholders' Rights Plan" which may be regarded as a so-called "poison pill", and which will need to be rescinded by Gulfstream's Board, or otherwise removed, prior to Roc Middle East agreeing to accept shares offered to it by Gulfstream shareholders. Another caveat requires that Gulfstream's key management contracts be made public and that the terms of those contracts be judged by Roc Middle East, at its sole discretion, to be consistent with normal industry standards. · In the event the offer is successful, Roc Middle East intends to propose that the Board of Gulfstream be reduced and restructured so that it will consist of five directors composed of three Roc Middle East nominees and two independent Canadian residents of impeccable standing within the Canadian business community. Roc Middle East's nominees for Gulfstream's Board will be three of ROC's current directors: - Mr Richard Burgess, formerly founder President and CEO of CMS Nomeco Oil & Gas and a director of ROC since 1997; - Mr Sid Jansma Jr, CEO and President of Wolverine Gas and Oil who is also a member of the Board of Governors of the Independent Petroleum Association of America and Chairman of that organisation's Environmental Committee. Mr Jansma also sits on the US Secretary of Energy Abraham's Transition Committee. Mr. Jansma has been a ROC director since 1998; - The third Roc Middle East nominee to Gulfstream's Board will be Dr John Doran, ROC's Chief Executive Officer and a founder director of the Company. · The offer will be open for acceptance until 6:00 p.m. (Calgary time) on Tuesday, May 8, 2001, unless withdrawn or extended.
All the following comments are based entirely upon data in the public domain.
In early 1997 Gulfstream's share price rose above C$15 following the startup of production from the Al Rayyan Oil Field which was discovered in 1995, offshore Qatar (Attachment 2). At that time, Gulfstream had a 27.5% interest in the field which, in 2000, Gulfstream agreed to increase to 65%. The field, which is operated by BP, started production in late 1996. Since then the field has produced approximately 25 million barrels of oil (MMBO) from an initial total proved reserve of 103 MMBO. To date, production has been via a leased jack-up rig and has been constrained to approximately 12,000-17,000 barrels of oil per day (BOPD) (net Gulfstream: 7,800-11,050 BOPD) largely because of OPEC cut-backs. In late 2000, the Al Rayyan Joint Venture submitted a Plan of Development to the Government of Qatar which proposed a full field development with an associated gross capital expenditure of US$140 million. The Plan of Development currently being considered by the Qatari Government, envisages production start-up in mid-2002 with a production capacity in excess of 40,000 BOPD (net Gulfstream: 26,000 BOPD) subject to OPEC constraints. The oil produced from Al Rayyan is somewhat heavy (25ºAPI) and slightly sour, therefore, it reportedly sells at a discount in the order of 13% to Brent. The remaining 78 MMBO (net Gulfstream: 51 MMBO) proved reserves at Al Rayyan, represent only a relatively small (<15%) fraction of the published estimate of the field's original in-place oil which is in excess of 600 MMBO (net Gulfstream: 390 MMBO).
Block 11, operated by the European oil company Wintershall AG, contains an unappraised oil discovery. Two wells are reportedly scheduled to be drilled in Block 11 within the next 12 months. 2.3 Exploration Acreage, Block 13, offshore Qatar (Gulfstream: 65%) Block 13 is a pure exploration block, although no exploration activity has been carried out since 1986 because the area has been subject to force majeure relating to a long running border dispute between Qatar and Bahrain. The final judgement of the International Court of Justice in the Hague, which had been considering the border dispute since 1991, was delivered on 17 March 2001. As a result, it is expected that the force majeure pertaining to Block 13 will be lifted, thereby allowing modern exploration techniques to be applied to the area for the first time. It must be emphasised, however, that ROC has not sighted any technical data relating to Block 13 and therefore any comment on the area's exploration potential is purely speculative. 2.4 Gas Field, Onshore Oman (Gulfstream 100% and Operator) Gulfstream's proved gas reserves in Oman are in the order of 287 BCF through its 100% ownership of a number of onshore gas fields in that country. These reserves are scheduled to be appraised and developed during the next 18 months through the application of horizontal drilling techniques. Total appraisal/development costs are reported to be US$38 million. Gulfstream also claims that a Gas Sales Contract has been signed with the Government of Oman, which envisages production commencing prior to end 2002. 2.5 Other Assets Until mid-2000, Gulfstream had a 65% interest in an agreement with the Government of Qatar relating to the marketing of future gas production from a portion of the North Field within Block 12. The proven reserves, just within this part of the North Gas Field - which, with proven reserves of almost 300 trillion cubic feet (TCF), is the largest gas field in the world - are in the order of 9 TCF. The right to market the North Field Gas expired in July 2000. Gulfstream and its co-venturers in Block 12, including operator BP, are continuing negotiations with the Government of Qatar. The absence of any public statement from Gulfstream to the contrary suggests that so far negotiations have not been successful. Gulfstream also has 100% interest in two exploration permits in Madagascar, a corporate office in Calgary, and an operating base in Cyprus.
· "If the offer for Gulfstream is successful ROC expects to receive substantial tangible medium and longer term benefits as a result of the establishment of a significant corporate presence in the Middle East. The move would essentially complete ROC's global portfolio building strategy whereby the Company sought to acquire a presence in two niche areas, Australia and the UK, and three international areas where it believes it has developed significant expertise: West Africa, the Middle East and selected parts of Asia. · Since selling its non-core UK assets approximately twelve months ago, ROC has pro-actively reviewed a large number of new venture opportunities. As a result the Company is generally inclined to the view that most potential asset acquisitions are over priced. Therefore, ROC turned its attention to a global review of corporate acquisition opportunities as a result of which the Gulfstream situation was identified. · ROC has relatively strong cash flow and a robust Balance Sheet. This allows ROC to finance the proposed acquisition from internal cash sources without any need to alter the Company's debt position, which is effectively zero, or to issue any new equity. The Company keeps most of its cash in US dollars and British Pounds, both of which have recently strengthened against the Canadian dollar. ·
Although the offer is unsolicited, it is intended to be friendly towards
Gulfstream's shareholders. In effect, ROC is simply providing them with
an opportunity to determine the future of their company. If Gulfstream's
shareholders accept the offer, ROC will be very committed to this initiative
which it regards as an integral part of its drive towards establishing
a well-balanced international oil and gas company with substantial reserves
and significant cash flow. Dr
John Doran Return to ASX Releases main page
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| UPDATE (03-04-01) |
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FORMAL OFFER DOCUMENT FOR GULFSTREAM RESOURCES CANADA LIMITED ("GULFSTREAM") Further to the announcement made by ROC yesterday on its offer to acquire 25.75 million shares of Gulfstream Canada Resources Limited ("Gulfstream") at a price of C$1.10 per share, attached is a copy of the formal offer document lodged with the Canadian Provincial Securities Commissions (except Quebec) and the Toronto Stock Exchange on 2 April 2001 in Canada and served on Gulfstream. Link to Formal Offer Document Dr
John Doran |
| UPDATE (03-04-01) |
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AMERADA
HESS LIMITED (AMERADA) ROC is pleased to advise that its wholly owned subsidiary, Roc Oil (UK) Limited, and its co-venturers in Block 22/2a, in the UK North Sea, have executed a Farmout Agreement ("The Agreement") with Amerada in relation to the Chestnut Oil Field. The Agreement, which is still subject to normal industry terms and conditions and receipt of relevant Government approvals, is designed to ensure that operations at the 22/2A-11 appraisal well, which is currently drilling within the Chestnut Field area, will continue smoothly notwithstanding advice from Brovig Production Services Limited ("Brovig") to the effect that it is unable to meet its contractual obligations in relation to the drilling of this well and the planned EWT. Amerada, a US multi-national oil company with a market capitalisation in excess of A$10 billion, is widely recognised as one of the leading North Sea operating companies. The essential elements of the Agreement with Amerada are: · Participants in the current Chestnut Joint Venture will be fully carried by Amerada through the drilling of the current well and the cost of the associated EWT. This effectively mirrors the arrangement with Brovig (see ROC's release to ASX dated 11 September 2000). · In consideration for providing this carry, Amerada will become operator of Block 22/2A and the Chestnut Oil Field and will earn from each existing co-venturer, on a prorated basis, a 50% interest in the Block and the Field. In this context, ROC's interest in the Chestnut Field will reduce to 14.875%, held through its wholly owned UK subsidiary. · Amerada will be able to recover preferentially the cost of the EWT from the oil produced by that operation. This is essentially the same as the arrangement which was originally put in place with Brovig. · In the event that the EWT results are considered to be encouraging, Amerada and the current Chestnut Joint Venture may choose to proceed with Phase Two of the development in which case each participant will fund its share of costs on a prorated (post-Amerada) farmin basis. This arrangement differs from the previous deal with Brovig whereby the costs of the Phase Two of the development would have been paid by Brovig, however, in that circumstance Brovig would also have received a disproportionately greater share of Phase Two production. By comparison, the agreement with Amerada is much more akin to a "normal" industry farmin so that ROC and the other co-venturers will also receive their prorated share of production from Phase Two. However In the event that the revenue received by Amerada from the EWT does not cover its EWT costs it will be entitled to receive up to a maximum of GBP£3 million in preferential production revenue from Phase Two. · Amerada will also reimburse the Chestnut Joint Venturers for certain past costs. In ROC's case these costs, including those associated with the additional equity the Company purchased last year, approximate to A$1.2 million. Commenting on the Agreement with Amerada, ROC's CEO Dr John Doran stated that: · "In view of the change in Brovig's financial circumstances, Amerada's entry into the Chestnut Joint Venture is very timely and very welcomed. It is a fine illustration of the flexible nature of the development options available to companies working in an active and well regarded petroleum province such as the North Sea". Dr
John Doran Return to ASX Releases main page
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