Caspian Holdings raises £ 4 mm in AIM float

Nov 02, 2004 01:00 AM

Caspian Holdings, the shallow field oil and gas exploration and production company focused on Kazakhstan, said that it intends to float on AIM in early November 2004.
Hoodless Brennan & Partners is acting as broker and Grant Thornton Corporate Finance is acting as nominated adviser for the Placing in which Caspian has raised just over £ 4 mm, at 23 pence giving the company a market cap of £ 18.9 mm.

Caspian was incorporated in May 2003 for the purpose pursuing oil and gas developments around the Caspian Sea and most specifically Kazakhstan. Caspian's entry was through the acquisition of Taraz, an operating company that owns the licences, leases and other assets that comprise the Zhengeldy oil field in Kazakhstan.
Caspian currently holds 70 % of Taraz and has entered into contracts to acquire the remaining 30 %. The Zhengeldy field has reserves of 13.2 mm barrels: proved reserves of 9.8 mm barrels and probable reserves of 3.3 mm barrels.

The strategy of the company is to focus on the shallow oil fields that offer the benefits of lower exploration and development costs, shorter lead times to production and higher returns on funds invested than are possible from deeper oil deposits.
Caspian acquired its share in February 2004 and initial production began in September 2004. The Zhengeldy field is being developed to support full commercial operations and the company expects to achieve over 1,400 bpd from its five wells. A further ten wells are planned for 2005, which is expected to bring targeted production to 4,300 bpd.

The Zhengeldy oil fields are located just 18 km from Makat, the central gathering and oil treatment stations for the international transit pipeline. In the short term, oil will be trucked to Makat for initial processing and storage, before entry into the pipeline.
A proportion of the funds raised will be used to increase production at Zhengeldy and pursue other shallow field development in Kazakhstan and the area around the Caspian Sea, the company said.

MichaelMasterman, Executive Chairman of Caspian, comments, "The Placing will provide us with the additional capital we require to press ahead with our strategy and the AIM listing will allow other investors to share in our already proven success".
"Kazakhstan is rich in natural resources, including oil and gas. It is rapidly growing in stature as an oil-producing region, with significant reserves both on- and off-shore. The government is actively encouraging foreign investment with political and monetary reforms", Masterman said.

Source: Dow Jones
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