Oil and gas exploration company Heritage Oil is commencing a $100 million share buy back programme after its board of directors decided that the current share price is trading below the company’s value.
Oil and gas exploration company Heritage Oil is commencing a $100 million share buy back programme after its board of directors decided that the current share price is trading below the company’s value.
Shareholders will purchase up to 28,786,693 ordinary shares, representing approximately 10 per cent of Heritage Oil’s voting share capital, following a resolution that was passed at its last annual general meeting in June 2010.
The company has been unable to begin the buy back programme until now as it has been trading in regulatory black-out for either operational or corporate reasons since the resolution was passed.
CEO Tony Buckingham comments, ‘The sale of the Ugandan assets in 2010 has provided Heritage with a strong balance sheet and available cash.
‘The recent share price performance following the discovery of the Miran gas field in Kurdistan neither reflects the underlying value of the assets nor our belief in the longer term prospects of the company,’ he adds.
At year end, Heritage announced it had $600 million of cash.
The board collectively owns 30 per cent of the share capital. Buckingham believes the buy back of shares is in the best interests of the company and its shareholders.
Heritage Oil is actively identifying prospects this year and is continuing with the appraisal of the Miran field in Kurdistan. It plans to drill further wells on the Zapadno Chumpasskoye Field in Russia.
