Nostra Terra Oil and Gas Company plc
(`NTOG' or the 'Company')
Market Update
24 December 2008
Nostra Terra Oil and Gas plc reports that subsequent to our reporting
unfavourable results on Oktyabroskoe Well #24 the Company has undertaken the
following actions.
A concerted effort to conserve cash and restructure liabilities was undertaken.
Management and Directors cash compensation was stopped and negotiations with
creditors were begun and employees in the Ukraine were made redundant.
We have continued to produce oil from Okktabryoskoe Well #1 and sales for the
month of November were 325.8 barrels although the average selling price has now
fallen to approximately $41.00 per barrel less royalties and production costs.
The creditor negotiations have produced informal agreement to a debt
restructuring under which Convertible Loan Stock holders are expected to extend
their debts (which are due for redemption at the end of this month).
Additionally, the Company has renegotiated an informal agreement to reduce the
face value of its Production/Acquisition notes due to Ucoco Energy Inc.,
Masterworks (Overseas) Limited and Nikea Trustees. These notes will be reduced
by 75% of their face value and assigned to NTOL. Should the restructuring not
proceed and other measures being undertaken fail to produce additional cash
resources, the Company's ability to continue operating would need to be
considered.
The Company is currently negotiating a Farm In Agreement with a public oil
company for the West Oktabryoskoe portion of the license held through NTOL. The
directors expect these negotiations to be concluded in early 2009 and will
report further to shareholders at that time. The directors are also reviewing
the possibility of selling unneeded assets in the Ukraine which were originally
held to develop Well #24 and associated Wells.
For further information contact:
Nostra Terra Oil and Gas Company plc
Brian Courtney, Chief Executive Officer bcourtney@ntog.co.uk
Stephen Oakes, Non-executive Director Tel: +44 (0)207 877 8788
Blomfield Corporate Finance Limited Tel: +44 (0)20 7489 4500
Alan MacKenzie
Peter Trevelyan-Clark
END