17 February 2015
Manager of Company Announcements
ASX Limited
Level 6, 20 Bridge Street
SYDNEY NSW 2000
By E-Lodgement
HIGHLIGHTS:
COMPLETION OF SALE OF OTTO'S INTEREST IN THE
GALOC OIL FIELD
CASH RESERVES OF US$106m (~A$136m)
PROPOSED CAPITAL RETURN OF A$0.064 PER SHARE
Otto Energy Ltd (ASX: OEL) (Otto) is pleased to announce the sale of Galoc Production Company W.L.L. (GPC) to Nido Petroleum Ltd (ASX: NDO) (Nido) has completed.
Final proceeds were received from Nido on 17 February 2015. Cash reserves following completion are as follows:
Cash as at 13 February 2015 US$28.6m
Final proceeds from Nido US$77.4m
Total US$106m
(~A$136m)
The final proceeds from Nido reflect adjustments from the effective date of the transaction, being 1 July 2014.
The Board of Otto intends to increase the proposed capital return to shareholders to A$0.064 per share (previously A$0.06 per share), which would utilise A$73.9m of Otto's cash reserves.
OTTO AT A GLANCE
• ASX-listed oil and gas company with a strategy to grow an integrated petroleum business through high impact exploration
• Focused on South East Asia and East
Africa
• Formerly Operator of the producing
Galoc oil field in the Philippines
COMPANY OFFICERS Rick Crabb Chairman Ian Macliver Director Rufino Bomasang Director
John Jetter Director Ian Boserio Director Matthew Allen CEO Craig Hasson CFO
Scott Blenkinsop Chief Legal Counsel
Company Secretary
Otto is seeking a class ruling from the ATO to confirm the taxation treatment of the proposed capital return.
Following receipt of the ATO ruling, the Board of Otto will meet to make a final decision on the proposed capital return.
The proposed capital return will then be considered at a shareholder meeting and, if approved, funds will then be returned to shareholders.
An indicative timetable for the capital return will be issued following the receipt of the ATO ruling and final decision by the Board.
Otto will utilise cash reserves remaining after payment of the proposed capital return to undertake the forward exploration programs at SC55 in the Philippines, and two licences onshore Tanzania. The planned
Head Office 32 Delhi Street, West Perth WA 6005 Australia PO Box 1414, West Perth, WA 6872 Australia T: +61 8 6467 8800 F: +61 8 6467 8801
Manila Office 32nd Floor Philamlife Tower, 8767 Paseo de Roxas, Makati City 1226, Philippines T: +63 2 773 2700 F: +63 2 773 2801 [email protected] ASX Code: OEL ABN: 56 107 555 046
farm-down of Otto's SC55 acreage together with the funding of US$24.5m from BHP Billiton positions Otto favourably for the drilling of the Hawkeye-1 exploration well.
Matthew Allen, Otto's CEO said: "Delivering financial close of the GPC sale is a significant milestone for Otto in this environment of depressed oil prices. Otto has a very strong balance sheet and is well advanced on prospective exploration activities in both the Philippines and Tanzania. Pleasingly, we have the financial capacity to undertake these high impact exploration activities and to pay a significant capital return to Otto's loyal shareholders."
Yours faithfully
Matthew Allen
Chief Executive Officer
Contact: Matthew Allen
Chief Executive Officer
+61 8 6467 8800 [email protected]
Media:
Matthew Gerber
MAGNUS Corporate and Financial Communication
+61 2 8999 1002 [email protected]
Head Office 32 Delhi Street, West Perth WA 6005 Australia PO Box 1414, West Perth, WA 6872 Australia T: +61 8 6467 8800 F: +61 8 6467 8801
Manila Office 32nd Floor Philamlife Tower, 8767 Paseo de Roxas, Makati City 1226, Philippines T: +63 2 773 2700 F: +63 2 773 2801 [email protected] ASX Code: OEL ABN: 56 107 555 046