Interoil recorded an EBITDAx (EBITDA adjusted for exploration expenses) from continuing operations of USD 1,2 million in Q4 2014 (Q4 2013: 10.6 million) on operating revenues of USD 8.1 million (Q4 2013: USD 11.6 million) producing net income from continuing operations of USD 4,7 million. The decrease in revenues and EBITDAx primarily results from the fall in the oil price and production and the recognition of one off income in 2013. Net loss from discontinued operations (Peru) amounted to USD 0.1 million, giving a comprehensive net income of USD 4,5 million.
As reported in the stock exchange notice 27 October 2014 and in the Company's Q3 financial report, Interoil was facing financial and strategic challenges. The Company was suffering from a heavy debt burden that was undermining its ability to support initiatives, which would protect and potentially increase the value of the Interoil's assets.
On 23 December 2014 the Board announced a comprehensive restructuring (the "Restructuring") proposal to improve its strategic position in Latin America, mitigate the Company's liquidity constraints and strengthen its balance sheet and this was completed on 20 January 2015.
The Restructuring involved an equity issue directed towards Andes Energia Plc ("Andes") and the restructuring of existing Company debt.
The new equity was raised by way of a private placement of new shares for NOK 36.3 million, pursuant to which Andes subscribed for 330,000,000 shares in Interoil at NOK 0.11 per share. The old NOK 310 million bond and the USD 6.2 million debt due to Proseis AG was replaced with a new USD 32 million bond loan. The Restructuring resulted in Interoil reducing its debt by approximately NOK 120 million.
As part of the Restructuring, holders of the old NOK 310 million bonds accepted 65,000,000 new shares in Interoil in part settlement of the bond, equivalent to approximately 10 per cent of the shares outstanding after Restructuring. Following the Restructuring, Andes holds 51 per cent of the outstanding share capital.
Andes is a Latin American company, active in exploration, development and production of conventional and unconventional oil and gas resources.
The Company is listed on the AIM London Stock Exchange and Buenos Aires Stock Exchange with a market cap of approximately GBP 135 million.
Sale of Peruvian business
In November 2014 Interoil transferred ownership of its Peruvian operations to United Oilfield Colombia Inc. The transaction allowed Interoil to discontinue its business in Peru in an orderly fashion without any material impact on its liquidity or financial position. As previously communicated, Interoil would not be qualified to continue as an operator in Peru or be able to repatriate any additional cash from Peru, and the business therefore did not represent any value for the company. In this financial report, the Peruvian business is reported as discontinued business (see note 4).
Following the sale in Peru, all Interoil's exploration and production assets are in Colombia. Key assets include the Puli-C and Altair producing fields and the LLA-47 license, all in prolific onshore hydrocarbon provinces in the country. In December the Puli-C field produced around 1,550 barrels of oil equivalents per day net to Interoil, but requires new investments to maintain output at current levels. The LLA-47 license is expected to hold well above 30 million barrels in recoverable reserves and represents a significant value driver for the company.
Detailed information on the operational and financial activities of Interoil is presented in Interoil's Q4 2014 Report enclosed.
The annual statement of reserves is enclosed.
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Interoil Exploration and Production ASA is a Norwegian based exploration and production company - listed on the Oslo Stock Exchange - with focus on Latin-America. The Company is operator of several production and exploration assets in Colombia. Interoil currently employs approximately 95 people and is headquartered in Oslo.