North Sea Energy Announces Annual Results for 2014


TORONTO, ONTARIO--April 28, 2015- North Sea Energy Inc. ("NSE" or the "Company") (TSX-V:NUK) announces that its financial results for the year ended December 31, 2014 along with the related Management Discussion and Analysis (“MD&A”) have been filed on SEDAR ( For more detailed information relating to the Company's yearend results, please refer to the financial statements along with the related MD&A filed on SEDAR.


Highlights and Significant developments for the year ended December 31, 2014


- In February 2014, the Company signed an agreement with Ithaca and Dyas, whereby under the terms of the Agreement, NSE UK agreed to withdraw from the Jacky Field (P.1392, Block 12/21c), effective December 31, 2013. The Agreement relieved the Company of all future costs including decommissioning liabilities for the Jacky field and settled all outstanding issues. By withdrawing from the field, the Company reduced its decommissioning liability by US$4.4 million.


- In May 2014, NSE obtained the results of an independent "Economic Assessment of Blocks 13/24c and 13/25 (Bagpuss and Blofeld), North Sea, United Kingdom"1. The potential economics of the prospects on a Low, Best, Mean and High cases on a before tax basis discounted by 10% are US$(65.30) million, US$311.7 million, US$689.51 million and US$1,842.35 million respectively net to NSE.


- In August 2014, the Bagpuss and Blofeld joint-venture partners received approval from DECC to convert the Bagpuss licence from a promote licence to a traditional licence which includes a firm drilling commitment by yearend 2016.


- In September 2014, the Bagpuss Site Survey was completed. The purpose of the survey was to collect high resolution digital seismic, soils data and a full range of environmental data that is required by the Department of Energy and Climate Control (“DECC”) prior to drilling of the initial Bagpuss well.


- In November, 2014, the Company announced that Statoil had acquired, through the 28th UKCS Licencing Round, the acreage neighbouring the Bagpuss and Blofeld prospects. NSE views this strong commitment by Statoil as further validation of the merits of the Bagpuss and Blofeld prospects.


- In November 2014, the Company reached an agreement with the holder of the $3,800,000 Convertible Debenture (the “Debenture”) regarding the Debenture issued on November 22, 2012. The holder has agreed to defer interest payable (including the interest payment that was due on November 22, 2014) and all future interest payments payable by the Company to the Subscriber, under certain conditions that must be met by July 1, 2015. If the conditions are not met by that time the Company has in its sole right the ability to convert the entire debenture at a price of $0.45 per share.


- In December 2014, the Company received the decision rendered by the International Tribunal in the arbitration between Gemini Oil & Gas Fund II, L.P. ("Gemini"), the Company and its subsidiary North Sea Energy (UK) Limited ("NSE UK"). The arbitration proceedings began in November 2011 and focused on the interpretation of the Loan Agreement between Gemini, NSE and NSE UK signed on September 5, 2008 to finance the development of the Jacky Field. The decision results include an award against NSE and NSE UK in the amount of US$5,820,907 plus simple interest at the rate of LIBOR +3% from September 1, 2014 to the date of payment. The arbitrator ordered that each party bear its own legal costs and that half of the costs of the arbitration be paid by each party.


-In December 2014, Premier Oil (UK) Ltd., the operator of the Bagpuss well (Licence P.1943), indicated that they would be delaying the drilling of the initial Bagpuss well until the first half of 2016.


Note: The report issued by Deloitte LLP ("Deloitte") on April 30, 2014, utilized the resource and geologic information developed by Senergy (GB) Limited ("Senergy") on June 25, 2013 with an effective date of May 30, 2013. (Please refer to the Company's press release issued on June 27, 2013 for discussion on the risks and level of uncertainty associated with recovery of the resources, the significant positive and negative factors relevant to the estimate of the resources.). Deloitte's economic assessment of the Bagpuss and Blofeld prospects indicates that, on a cumulative basis, the Best, Mean, and High case resource estimates are commercial under the assumed development, pricing, and cost scenarios, yielding after-tax internal rates of return of approximately 18, 28, and 51 percent, respectively.


Subsequent events


&-In February 2015, the Company announced the appointment of Mr. Larry LeBlanc to the Board of Directors of NSE. Mr. LeBlanc has 38 years of diverse international, frontier and domestic energy experience. The Company also announced that Mr. Dave Antony had resigned as a director of NSE.


&-In March 2015, the Company announced that NSE is in discussions with a major international oil company that is currently evaluating several of its blocks for a possible farm-in deal. The Company announced that it is in negotiations with Gemini in efforts to find a solution to satisfy the liability with respect to the arbitration award. NSE was not granted ‘leave to appeal’ the final award as referenced in the December 2, 2014 announcement.



Symbol: TSX-V: NUK




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As at and for the year ended
  December 31, 2014 CAD ($) December 31, 2013 CAD ($) December 31, 2012 CAD ($)
Assets 2,622,833 4,932,541 20,695,048
Long-term liabilities 3,730,228 3,497,383 4,772,424
Shareholders' (Deficit) Equity (8,168,546) (1,852,878) 12,474,196
Revenues 4,087 2,131,616 4,075,602
Loss before income tax expense (6,087,250) (14,456,877) (6,877,755)
Net loss (6,087,250) (14,456,877) (5,844,755)
Total comprehensive loss for the period (6,399,668) (14,456,877) (5,938,295)
Basic and diluted net loss per share (0.103) (0.247) (0.100)

Year End Reserves Information

At December 31, 2014, the Company had no oil and gas reserves assigned to its assets. The Company has filed Forms 51-101 F1, 51-101 F2 and 51-101 F3 on SEDAR.


About NSE:

NSE is an oil and gas company that holds a portfolio of high impact interests focused on the Moray Firth in the offshore UK North Sea. These interests include the Bagpuss and Blofeld prospects (blocks 13/24c and 13/25), Norfolk prospects (blocks 12/16b and 12/17b), Del Monte (blocks 19/2 & 19/3) and Golden Phoenix leads (block 18/10a).



For further information, please contact:


J. Craig Anderson

Chairman & CEO

North Sea Energy Inc.

(416) 366-4700


Forward-looking statements


Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. In particular, forward-looking information in this press release includes, but is not limited to, statements with respect to oil reserves and future revenues. Although we believe that the expectations reflected in the forward-looking information are reasonable, there can be no assurance that such expectations will prove to be correct. We cannot guarantee future results, performance or achievements. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking information. Forward-looking information is based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors that could cause the results to differ materially from those expressed in the forward-looking information include, but are not limited to: general economic conditions in Canada, the United States, UK and globally; industry conditions, including fluctuations in the prices of oil and natural gas; governmental regulation of the oil and gas industry, including environmental regulation; unanticipated operating events or performance which can reduce production or cause production to be shut in or delayed; failure to obtain industry partner and other third party consents and approvals, if and when required; competition for and/or inability to retain drilling rigs and other services; the availability of capital on acceptable terms; the need to obtain required approvals from regulatory authorities; stock market volatility; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; competition for, among other things, capital, acquisitions of reserves, undeveloped lands, skilled personnel and supplies; incorrect assessments of the value of acquisitions; geological, technical, drilling, processing and transportation problems; changes in tax laws and incentive programs relating to the oil and gas industry; failure to realize the anticipated benefits of acquisitions and dispositions; and the other factors. Readers are cautioned that this list of risk factors should not be construed as exhaustive.


Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.




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