The Vancouver-based Dover Petroleum Corporation has concluded a private placement equity financing totaling six million dollars. The proceeds of the financing are intended to be used for exploration phase drilling commitments in Egypt and for general working capital purposes. Dover believes that such proceeds are sufficient to enable it to meet all such exploration phase drilling commitments, stated a company press release.
On June 18, 2002, the Peoples Assembly of the Egyptian Parliament passed into law the Concession Agreement for Petroleum Exploration and Exploitation between Dover Investments Limited (an unaffiliated entity controlled by Robert Salna), the Arab Republic of Egypt and the Egyptian General Petroleum Corporation. An official signing ceremony is to take place shortly, anticipated the Dover release.
The Concession Agreement provides the exclusive concession for the exploitation of petroleum and natural gas in and throughout the East Wadi Araba Area of the Gulf of Suez. After the signing ceremony, exploration under the Concession Agreement can commence, and discussions are underway with the Egyptian General Petroleum Corporation to finalize drilling dates.
Each Unit sold as part of the financing consisted of one share of Dover's common stock and one common stock purchase warrant, exercisable at a price of $0.80, and was sold at a price of $0.50 per Unit.
After payment of the expenses associated with the offering and upon collection of a certain subscription receivable in the approximate amount of $2.35 million due from Robert Salna, Dover's chief execute officer, the net proceeds to Dover will be approximately $5.4 million.
After the equity financing, and assuming receipt of the subscription receivable but without consideration of the exercise of any of the warrants, Dover will have approximately 48,537,000 shares of common stock outstanding.
Dover's wholly owned subsidiary, Dover Egypt owns a 50 percent interest in Dover Egypt I Joint Venture which is a party to an Option Agreement entitling Dover Egypt I Joint Venture to acquire the interest of Dover Investments Limited in the Concession Agreement.
Accordingly, Dover intends to fund four million dollars to its subsidiary Dover Egypt, to enable Dover Egypt to fund its obligations under the Dover Egypt Joint Venture Agreement, and will enable the Dover Egypt Joint Venture to meet its financial obligations under the Option Agreement related to the drilling of second exploration phase wells as required by the Concession Agreement.
Ghareeb Awad, a geophysicist by training and another partner of Dover Egypt I Joint Venture, provided Dover with information indicating that recently undertaken seismic and oil migration studies reveal 14 promising seismic targets in the East Wadi Araba Area, with the potential for four to five commercial oil discoveries that could produce in the range of 500 million barrels of recoverable oil.
Likewise, information provided to Dover from a recently completed a seabed survey of the second exploration well targets indicates that the surface founding strength of the sea floor conditions show the integrity to support the stabilizing tripod of a drill rig.
Such survey consisted of taking shallow seismic readings to test for shallow gas, a magnetic survey to identify any metallic debris, extracting five shallow (five meters deep) cores per site and performing a visual inspection for reefs and obstructions on the sea bed floor.
Dover is continuing to undertake necessary actions to have its eligible securities quoted on the Over the Counter Bulletin Board. Currently, such eligible securities are quoted through the Pink Sheets (DVPC). — (menareport.com)
© 2002 Mena Report (www.menareport.com)
