RAMCO ENERGY: Company Profile

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NAME: RAMCO ENERGY PLC

      62 Queen's Road

      Aberdeen

      AB15 4YE

      United Kingdom

 

      RAMCO OIL SERVICES LIMITED

      Badentoy Road, Badentoy Park

      Portlethen, Aberdeen

      AB12 4YA

      United Kingdom

      Phone: +44 (0)1224 782 278

      Fax: +44 (0)1224 783 001 

 

PHONE: +44 (0)1224 352 200

 

FAX: +44 (0)1224 352 211

 

EMAIL: General Enquiries

       jacqueline.christie@ramco-plc.com

 

WEBSITE: http://www.ramco-plc.com/

 

TYPE OF BUSINESS:  Ramco Energy and its subsidiaries operate in two divisions: Oil Field Services and Oil and Gas Exploration and Production.  Its oil services division specializes in down-hole tubular maintenance and pipeline coatings.  It operates primarily in Japan, Norway, and the U.K.  Its oil and gas exploration and production division operates in the Caspian Sea region, Central and Eastern Europe, and the Irish Sea.  It also holds a 50% stake in British Steel Ramco Pipeline Services, a joint venture with British Steel, to provide pipeline-coating services.

 

SIC: Natural Gas; Oil Equipment & Services; Oil

 

BOARD AND MANAGEMENT TEAM:

 

(a) Stephen Remp, Executive Chairman,

 

(b) N Stewart Cumming, Managing Director of Ramco Oil Services,

 

(c) Steven Bertram, Group Financial Director

 

Investor Relations: College Hill Associates Limited

                    78 Cannon Street, London EC4N 6HH

                    Leishman-Hillard Saunders 15 Fitzwilliam                

                    Quay, Dublin 4, Ireland

 

NUMBER OF EMPLOYEES: 118 (as at 2003)

 

NET INCOME: GBP76.7 million (2003)

 

CURRENT ASSETS: GBP14.035 million (Interim results for the six

                                   months ended 30 June 2004)

 

CURRENT LIABILITIES: GBP25.764 million (Interim results for the

                                        six months ended 30 June

                                        2004)

 

LONG-TERM LIABILITIES: GBP40.710 million (Interim results for

                                          the six months ended

                                          30 June 2004)

 

INTERESTS:

 

Country         Licence         Effective interest (%) Operator

Ireland       Seven Heads Gas

              Petroleum Lease          86.5             Ramco

Ireland       Seven Heads Oil

              Licensing Option         74               Ramco

Ireland       Midleton Licensing

              Option                  100               Ramco

Ireland       Rosscarbery Licensing

              Option                   77               Ramco

Ireland       East Kinsale Licensing

              Option                  100               Ramco

Poland        Carpathian Licences

              (onshore)                41.5             RWE

                                                        Dea AG

 

SEVEN HEADS PARTNERS:

 

     Ramco Seven Heads Limited (RSHL)

     (wholly owned subsidiary of Ramco)     82.5%

 

     Northern Exploration Limited

     (wholly owned subsidiary of Ramco)      4%

 

     Lundin Ireland Limited                 12.5%

 

     Sunningdale Oils (Ireland) Limited      1.0%

 

CAPITAL STRUCTURE:

 

 Bank debt: GBP40.710 million

 

OTHER DEBT:

  

  Type of Loan           Creditor                Amount

  ------------           --------                ------

Project loan           Bank of Scotland         GBP68.6 million*

                       New Uberior House

                       11 Earl Grey Street

                       Edinburgh EH3 9BN

 

 

Payment for services   Schlumberger Offshore    GBP1.550 million

(owed by subsidiary)   Services Limited

 

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To be repaid in six monthly installments.  GBP56.6 million is non-recourse, secured only against the Group’s interest in the Seven Heads gas field.  The balance of GBP12 million is also secured against the Oil Services business.  Full repayment of the GBP68.6 million is due by 30 June 2009.  The first installment of GBP5.0 million fell due on 30 June 2004.

 

THE TROUBLE:

 

Business and Financial Problem:

 

Ramco negotiated the rescheduling of its debts with lenders after encountering problems with its Seven Heads' operations.  Troubles at the field resulted to a GBP93 million charge at its accounts last year.  The resulting pre-tax loss for 2003 amounted to GBP104.1 million. 

 

Its bankers and a major creditor recently agreed to extend waiver agreements for GBP12.0 million and GBP1.55 million in debts until it sells the 86.5% interest it holds in the troublesome operation.

 

Legal Problem:

 

In April 2004, A Texas Court issued a final judgment against Ramco Energy plc, Ramco Oil Limited and certain other defendants in a case alleging breach of contract arising from confidentiality and non-circumvention obligations in relation to investments in an oilfield development project in Kazakhstan, which Ramco subsequently decided not to pursue. 

 

The ruling was an award against Ramco for past and future damages of US$6.4 million plus interest and legal fees of US$9.8 million. The award of legal fees was made jointly and severally against Ramco and its co-defendant Halliburton.  The plaintiff subsequently agreed settlement terms with Halliburton which has been dismissed from the case. 

 

Ramco has filed motions to appeal.  It said that the appeal to the Texas Appellant Court, which may be followed by a further appeal to the Texas Supreme Court, is expected to take several years to complete.

 

MAJOR SHAREHOLDERS:

 

Artemis Smaller Companies -  5.17%

Hansa Trust PLC           -  3.75%

Finsbury Trust            -  3.53%

 S E Remp                 - 11.07%

N S Cumming               -  1.08%

Other Dirs                -  0.47%

 

NOMINATED ADVISER:  CANACCORD CAPITAL (EUROPE) LIMITED

                    Brook House, 27 Upper Brook Street

                    London W1K 7QF

 

AUDITOR: PRICEWATERHOUSECOOPERS LLP

         32 Albyn Place, Aberdeen AB10 1YL

         Web site: http://www.pwcglobal.com/uk

 

ASSET SALE MANAGER: ERNST & YOUNG

                    5 Times Sq., 14th Fl.

                    New York, NY 10036-6530

                    Phone: 212-773-3000

                    Fax: 212-773-6350

                    Web site: http://www.ey.com/