POSTING OF SHAREHOLDER CIRCULAR AND NOTICE OF GENERAL MEETING

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On 14 June 2010, Dana announced that the Company (through one of its subsidiaries) had entered into an agreement to acquire the entire issued share capital of Petro-Canada Netherlands B.V. (“Petro-Canada Netherlands”), a wholly owned subsidiary of Suncor Energy Inc., for an estimated cash consideration of approximately €328 million (note 1) (the "Proposed Acquisition").

The Board of Dana Petroleum plc (the "Company") is pleased to announce that it is today posting a circular to its shareholders (the "Circular") setting out details of the Proposed Acquisition. The Circular will be available to view shortly on the Company's website (www.danapetroleum.azurewebsites.net).

The Circular contains, inter alia, a Competent Person's Report on the Petro-Canada Netherlands assets (“CPR”). The assumptions utilised by the Competent Person are set out therein. The CPR includes the following information in respect of Petro-Canada Netherlands:

 

  • As at 1 January 2010, being the economic effective date of the Proposed Acquisition, Petro-Canada Netherlands had net total 2P reserves of 31 mmboe.
  • The base case valuation of Petro-Canada Netherlands’ 2P reserves as at 1 January 2010 is €348.2 million. In addition, the Alkmaar PGI storage facility is valued at €42.4 million as at 1 January 2010, resulting in a total CPR valuation for Petro-Canada Netherlands, on a 2P basis, of €390.6 million, as further described in the Circular.
  • Total net 3P reserves are 51 mmboe. The base case valuation of Petro-Canada Netherlands' 3P reserves as at 1 January 2010 is €567.1 million, which, together with the Alkmaar PGI storage facility, results in a total CPR valuation for Petro-Canada Netherlands, on a 3P basis, of €609.5 million, as further described in the Circular.
  • Near term prospects represent 12.0 mmboe of net risked prospective resources, with additional net risked prospectivity of 7.8 mmboe. The aggregate best case valuation of Petro-Canada Netherlands’ prospects, as at 1 January 2010, is €91.2 million.

 

  1. The circular also contains further details of the facilities agreement entered into on 15 July 2010, pursuant to which Dana has secured a new term loan of US$300 million and a revolving credit facility of up to US$600 million, which replaces the Company’s existing US$400 million revolving credit facility.
  2. Shareholders should read the whole of the Circular and not rely solely on the summarised information in this announcement.
The Circular contains a notice convening a General Meeting of shareholders to be held at 11.00 am on 9 August 2010 to approve the Proposed Acquisition.

 Tom Cross, Dana's Chief Executive commented:

 “This transaction represents Dana's fourth international acquisition in the past three years and is the most significant and exciting development in the Company's history. The acquisition builds upon our portfolio approach to the E&P business and provides a significant production and reserve growth step for the Group, whilst adding considerably to our operating capability in the North Sea. Following the transaction, Dana’s daily production should increase to approximately 50,000 barrels per day. This significant transaction puts Dana in a position of increased strength as the Company enters the busiest exploration and development period in its history."

The Circular can be inspected during normal business hours on any business day at the offices of Allen & Overy LLP, One Bishops Square, London, E1 6AD from today up to the conclusion of the General Meeting.

In addition, the Circular will shortly be available for inspection at the UK Listing Authority's Document Viewing Facility, which is situated at: Financial Services Authority, 25 The North Colonnade, Canary Wharf, London E14 5HS, telephone +44 (0) 20 7066 1000.

  1.  
  2. Note 1 – This figure assumes the Proposed Acquisition completes on 16 August 2010 and takes into account certain agreed adjustments to be made to the Proposed Acquisition price pursuant to the Sale and Purchase Agreement entered into between the parties, as set out in further detail in the Circular.

21 July 2010

 

Enquiries:

Tom Cross, Chief Executive Dana Petroleum plc 01224 652400
David MacFarlane, Finance Director Dana Petroleum plc 01224 652400
Stuart Paton, Technical & Commercial Director Dana Petroleum plc 01224 652400
Stephen Bowler RBS Hoare Govett Ltd 020 7678 8000
John MacGowan RBS Hoare Govett Ltd 020 7678 8000
Tim Chapman RBC Capital Markets 020 7653 4000
Josh Critchley RBC Capital Markets 020 7653 4000
Nick Elwes College Hill Associates 020 7457 2020

NOTES TO EDITORS:

Dana Petroleum plc is a leading independent oil and gas, exploration and production company listed on the London Stock Exchange (symbol: DNX), and is a constituent of the FTSE 250 Index.
The Group currently produces from 36 oil and gas fields across four countries (UK, Netherlands, Norway & Egypt) and holds more than 100 interests in exploration and production licences spanning nine countries. Dana’s activities are focused within its two core areas of Europe (North Sea) and Africa (North & West).
In Africa, Dana has production, development and exploration interests across Egypt, oil and gas discoveries offshore Mauritania and Morocco, and additional exploration opportunities offshore Senegal and Guinea.
In Europe, Dana’s producing interests are focused on oil and gas in the UK North Sea, oil offshore Norway and gas offshore The Netherlands. Dana also has significant development and exploration opportunities across the North Sea, including development of the Babbage gas field which is due on-stream in August 2010, the Arran gas fields (formerly known as Barbara/Phyllis) and the Western Isles oil fields.

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