Launch of Discover Exploration plc

Former Cove Energy management team
Announcement of first strategic deepwater licence

 

11 March 2013: Discover Exploration plc (“Discover” or the “Company”), the geology led exploration company specialising in deepwater petroleum systems is pleased to outline its strategy, management team and the details of its first strategic licence.

Company Highlights:

  • Strong and experienced, former Cove Energy (“Cove”), management team and executive Board, with a track record in delivering shareholder value
    • Michael Blaha, Executive Chairman
    • John Craven, Chief Executive Officer
    • Michael Nolan, Chief Financial Officer
  • Geology led exploration company focussing on offshore deep water petroleum systems
  • Aim to build a balanced portfolio of oil and gas exploration assets in emerging basins
  • Leverage management’s relationships with senior industry and financial executives
  • Seed financing from holding company of Oranje-Nassau Energie B.V. (“ONH”), the management team and Board
  • Initial focus on offshore sub-Saharan Africa

Licence Highlights:

  • Signature of a Production Sharing Contract (“PSC”) offshore Comoros, adjacent to major Rovuma Delta gas discoveries
  • PSC licence area located over the outboard part of the Rovuma Delta, near to gas discoveries by Anadarko Petroleum Corporation (“Anadarko”) and ENI S.p.A (“ENI”) (total gas-in-place approaching a combined 175TCF), offshore Northern Mozambique
    • First PSC signed by the Government of the Union of the Comoros covering c. 18,000 km2 in full compliance with the recently promulgated Petroleum Code
    • Existing 2D seismic data indicates the extension of Rovuma basin floor fans continuing into the PSC licence area
    • Initial work programme will include further acquisition of 2D seismic, followed by 3D seismic and drilling. Parties to the PSC, which covers a 10-year exploration period, are Discover (60%), Bahari Resources (40%) and the Government of the Union of the Comoros.

Discover is being advised by Investec Bank plc (“Investec”) on its financing strategy

 

Strategy

Discover’s strategy is to deliver value to shareholders through participation in exploration and appraisal programmes focussing on deepwater petroleum systems. The Company will concentrate on young emerging basins, de-risked through 2D and 3D seismic, and where appropriate participate in multi-well drilling programmes through farm-ins, farm-outs and M&A activity.

The Company has solid industry relationships and will work with reliable, well financed and proven partners to build a balanced portfolio of exploration assets with both oil and gas potential.

Discover is currently in discussions with several parties to gain access to a number of deepwater turbidite plays principally, but not exclusively in offshore sub-Saharan Africa.

 

Board and Management

The management team, led by Executive Directors Michael Blaha, John Craven and Michael Nolan, have strong technical expertise in deepwater hydrocarbon plays, solid industry reputations and continuing relationships with major oil companies. In addition, Marcel van Poecke, founding shareholder and Chairman of Oranje-Nassau Energie B.V. (“ONE”), Alexander Berger, CEO of ONE and a non–executive board member of Cairn Energy plc, and Paddy Spink, senior advisor to the Board of ONE, are on the Board as Non-Executive Directors. Paul Griggs and Alexander Mollinger, both former Cove executives, are also part of the Discover executive team. The organisation will be lean, nimble and opportunity driven focussing on delivering value to shareholders.

 

PSC and the Union of the Comoros

The Union of the Comoros is located in the Mozambique Channel. Discover’s PSC licence area is outboard of and on trend with Areas 1 and 4, offshore Mozambique, operated respectively by Anadarko and ENI, approaching a combined 175 TCF in place of gas discoveries. Under the terms of the PSC, the partnership will undertake a phased seismic and drilling programme within the licensed area and will, in addition, carry out a regional study of the entire Comorian territory for the Government.

 

Michael Blaha, Executive Chairman of Discover, said:

“Given the recent success the management have enjoyed with Cove Energy, I am delighted to be joined with them again in Discover Exploration. The support of ONH provides for an excellent combination and strengthens our capabilities. Discover will be an opportunity driven company and our objective is to enter into various deepwater turbidite plays in young emerging basins, with reliable and proven partners, and with value added through drilling. Whilst entry into Africa is a primary target, our discussions are not restricted to this geography.

The commercial and financial support we have received to date from founding shareholder Marcel van Poecke/ONH is outstanding and we look forward to delivering shareholder value from the outset.”

 

John Craven, CEO of Discover, commented:

“I am very pleased to introduce Discover Exploration and its strategy, core to which is utilising the strong geo-technical expertise, industry contacts and successful track record of our Board and management team to identify frontier oil and gas prospects, as we build a balanced portfolio of assets.

The signature of this strategic PSC with the Government of the Union of the Comoros and Bahari Resources, covering the seaward section of the Rovuma Delta and bordering the highly prospective offshore Mozambique hydrocarbon province, presents a unique opportunity given its geographical and geological position. This gives Discover a unique first mover advantage and we look forward to working with the Government and His Excellency Dr. Ikililou Dhoinine, President of the Union of the Comoros, and our partner Bahari Resources to unlock the potential contained within our PSC license area.”


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