UK's Halo Provides Update on Spinoff

London-listed small independent Hague and London Oil (Halo) provided an update August 9 on its spin off, Vermeer Exploration.

Halo said May 11 2016 that higher risk exploration assets, including its five exploration blocks offshore the contested territory of Western Sahara, as well as in French Guyana, were to be spun into subsidiary Vermeer of which 51% shares were to be sold by Halo for $0.5mn to a group of investors including Halo executive chairman Andrew Cochran. The first half of that was paid in H1 2016 and the second half was to be payable upon successful extension of the French Guyana licence

In the light of delays and increasing uncertainty around that licence extension, Vermeer investors provided $375,000 short term working capital since 4Q2016 to Halo in the lead up to completion of its proposed acquisition of Tullow’s Dutch assets, announced on 10 April 2017 but which has since been delayed. Details of the loan agreement have yet to be announced, said Halo. But it has now said the second transfer of 25.5% of Vermeer shares to the Vermeer Investors, which was subject to the Guyana extension, was made to them in June 2017. Hence Vermeer is now 51%-owned by the investors.

Halo also said that the Philippines Department of Energy has announced a further 3-year suspension to the SC54A (NW Palawan Basin) licence exploration period as a result of Force Majeure in respect of a territorial dispute with China that is the subject of international arbitration. The suspension runs until August 5 2020, unless the dispute is settled before then, and no activity is expected there for the foreseeable future. Halo has a 15% non-operating interest in the Service Contract covering SC54A.

Mark Smedley