Fanning’s embattled San Leon warns partner over UK petition

Fuel exploration firm wants to nail down up to $190m in refinancing

Irish oil and gas exploration firm San Leon has insisted a winding-up petition lodged against a key subsidiary “will have no bearing” on the speed at which crunch funding of as much as $190m can be secured by the company.

In response to a report from the Irish Independent yesterday, San Leon issued a notice to the London stock exchange urging the withdrawal of the winding-up petition.

Ocean Pearl Maritime has lodged the petition against San Leon ELI in the UK’s High Court. The petition stems from an ongoing dispute between San Leon, which is headed by Oisin Fanning, and Ocean Pearl.

San Leon and Ocean Pearl Maritime own stakes in a company called Energy Link Infrastructure (Malta), which controls a recently completed pipeline and floating storage and offloading vessel dedicated to transporting oil from a producing asset in Nigeria in which San Leon has a stake.

San Leon owns its stake in Energy Link Infrastructure via its wholly owned San Leon ELI unit.

“San Leon considers the petition to be both aggressive and vexatious in nature,” said San Leon in a statement to the stock exchange in London yesterday.

Its shares have been suspended since last year.

“The directors of the company believe that it will have no bearing on the speed at which funding can be put in place and is arguably detrimental to Ocean Pearl’s own interests if prospective funding partners object to Ocean Pearl’s approach,” it insisted.

It added: “San Leon has strongly advised Ocean Pearl to withdraw its petition and instead work constructively with the company towards an expedient completion of the acquisition of its 13.5pc interest in ELI [Energy Link Infrastructure (Malta)].

“If Ocean Pearl does not withdraw its winding-up petition, then San Leon has retained legal advisers to robustly defend and overturn the petition.”

San Leon has been trying to secure as much as $190m in funds it needs to refinance the business and last month again said it’s close to sealing a deal.

Part of those funds would be used to finance the purchase of the Ocean Pearl stake in Energy Link Infrastructure (Malta).

In 2022, Ocean Pearl and San Leon ELI reached an agreement that would see the latter acquire shares owned by Ocean Peal in Energy Link Infrastructure (Malta) for $15m.

That would give San Leon ELI a 55pc stake in the Malta unit.

Early last year, a legal letter was sent to San Leon ELI demanding payment and Ocean Pearl subsequently sued the San Leon unit in London last summer.

San Leon ELI has insisted that it is not liable to pay the sum demanded by Ocean Pearl. It claims that under the contract, if the deal was not consummated by the end of 2022, it became null and void. Ocean Pearl has denied this.

Despite the continuing litigation, San Leon told investors last October that it had renegotiated the purchase price of the 13.5pc stake owned by Ocean Pearl, down to $12m.

“It is self-evident that the acquisition from Ocean Pearl was conditional on completion of San Leon’s refinancing,” San Leon stated yesterday.

“Furthermore, as all shares in ELI are pledged to ELI’s senior lender, completion of any transfer of shares requires the consent of the lender.”

Ocean Pearl has previously claimed that it has secured the required consent to sell a stake in Energy Link Infrastructure (Malta) to San Leon ELI.

“The agreement with Ocean Pearl requires the parties to work together to secure that consent,” said San Leon yesterday.

“However, to date, Ocean Pearl has made no offer or representations in this regard.”