HOUSTON, Jan. 23, 2004 (PRIMEZONE) -- Transmeridian Exploration, Inc. (OTCBB:TMXN) announced today that it has closed a private placement of 7.3 million shares of common stock for net proceeds totaling approximately $4.4 million. The common stock was sold at a price of $0.65 per share, which represented a 20% discount to the trailing five day average price on the commitment date of January 9, 2004. The shares were purchased primarily by European individual investors. The terms of the transaction include certain registration rights. The proceeds from the offering will be used for repayment of debt and other corporate purposes.
There were no warrants or other dilutive securities issued in connection with this transaction. After this private placement, Transmeridian will have 78.0 million shares outstanding. Stock options and warrants outstanding represent 2.2 million potentially dilutive securities, or less that 3% of the total shares outstanding.
Management Comments
Lorrie T. Olivier, Chairman and Chief Executive Officer of the Company, commented, "This transaction greatly improves our financial position and allows us to satisfy the $2.9 million payment due to Turan Alem Bank. This payment, which relates to certain funds advanced to Transmeridian in 2001 during the pre-development stage of the project, is an important step to maintain our good relationship with the bank. We are very fortunate to have a group of investors who know the Company and understand our potential. When the need for additional equity arose, we were able to draw on this strong base of support. This capital will benefit the Company at a time of great opportunity. We have momentum in our drilling program and expect to achieve significant results in 2004."
Randall D. Keys, Chief Financial Officer of the Company, added, "In our earlier private placement in October, we raised $1.0 million when the stock was trading at a significantly lower price. In this placement, only 90 days later, we were able to raise significantly more capital at a much better price per share. We are very pleased that both these offerings were done without warrants or other additional dilution to our shareholders."
Operational Update
The Company currently has Schlumberger wireline and coiled tubing equipment on location in the South Alibek Field. The first operation, which is expected to take approximately one week, is to perforate and acid stimulate additional reservoir zones in the SA-1 well. The Company has been producing this well on a test basis with varying choke sizes since performing an acid stimulation in mid-September of last year. The equipment will then be rigged up to begin completion operations on the SA-4 well which reached total depth and was logged in late December. The remaining well, the SA-2, has reached its total depth of 13,800 feet. Based on the indications of hydrocarbon in several intervals during the drilling of the KTII sections, the company will log and run production casing to begin the testing of the well.
About Transmeridian Exploration
Transmeridian Exploration, Inc. (OTCBB:TMXN) is an independent oil and gas company with headquarters in Houston Texas. Founded in 2000, its primary objective is to acquire and develop oil properties in the Caspian Sea region of the former Soviet Union. TMXN primarily targets medium-sized fields with proved and probable reserves and upside reserve potential. Its first major project is the South Alibek Field in Kazakhstan.
This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities and Exchange Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created therein. Investors are cautioned that all forward-looking statements involve risks and uncertainties, including but not limited to those discussed in the Company's Annual Report on Form 10-K for the year ended December 31, 2002. Although Transmeridian Exploration, Inc. believes the assumptions underlying the forward-looking statements contained herein are reasonable, there can be no assurance that the forward-looking statements included in this press release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion herein should not be regarded as a representation by the Company or any other person that the objectives and plans of the Company will be achieved. TMXN discloses proved reserves that comply with the Securities and Exchange Commission's (SEC) definitions. Note that the Company's use of terms such as "ultimate potential" and "recoverable reserves" include quantities of oil that are not yet classified as proved and which the SEC guidelines do not allow us to include in filings with the SEC.