Bonus ahead for BornOil shareholders and Warrant holders!


Borneo Oil Berhad has announced a corporate exercise that is sure to delight shareholders and, in particular, existing Warrant holders.

In an announcement to Bursa Malaysia, the company is proposing to undertake the following:-

  1.     A bonus issue of up to 2,112,341,814 new ordinary shares in Bornoil (“Bornoil Share(s)”) (“Bonus Share(s)”) to be credited as fully paid-up on the basis of four (4) Bonus Shares for every eight (8) existing Bornoil Shares held on an entitlement date to be determined later; and
  2.     A bonus issue of up to 528,085,453 new warrants in Bornoil (“Warrant(s) D”) on the basis of one (1) free Warrant D for every eight (8) existing Bornoil Shares held on the same Entitlement Date as the Proposed Bonus Issue of Shares.

This initiative serves to reward existing BornOil shareholders while also enhaninge the Company’s capital base as it would increase the Company’s issued share capital to a level which would be more reflective of its current scale of operations and assets employed; reward existing shareholders of the Company for their continuous support; and enlarge the number of Bornoil Shares held by the Company’s existing shareholders without increasing the percentage equity interest. It also serves to possibly encourage trading liquidity of Bornoil Shares on Bursa Securities and greater participation by investors as well as potentially broadening the shareholder base of the Company.

For Warrant B and C holders, the Proposed Bonus Issue of Shares may give rise to adjustments to the exercise price and/ or subscription rights of the outstanding Warrants held by each holder respectively. Any adjustment which is required will be made in accordance with the provisions of their respective Deed Polls to mitigate any potential equity dilution resulting from the Proposed Bonus Issue of Shares and to ensure that the status of the holders of the outstanding Warrants are not prejudiced after the completion of the said proposal. Any such adjustment will only be finalised on the Entitlement Date. In addition, a notice will be despatched to the holders of Warrants B and C in the event of any such adjustment.

Late last month, BornOil announced that additional gold finds at its Bukit Ibam site. It had announced that the Drill Result of the on-going phase 2 carried out by its wholly owned subsidiary, Borneo Oil & Gas Corporation Sdn. Bhd, had identified additional gold mineralization at depth at Bukit Ibam – intercepted 8.3 metres with weighted average gold grade of 2.68g/t, including high grade zone of one meter with 19.2g/t gold and 14 meters averaging 1.39g/t gold.

The on-going 3,500-meter Phase 2 preliminary diamond drilling results at Bukit Ibam has proven the down-dip continuation of surface gold mineralization intercepted by shallow trenches as mentioned in its July 2016 announcement, said the statement.

“The surface mineralization seems to continue at depths of around 70 meters as proven by some of the current Phase 2 diamond holes. Most notable of the holes drilled are BMD28 and BMD29, located around 30 meters apart north-south, that have both intercepted significant and continuous gold mineralization along strike and dip as shown in section view of Figure 1. BMD28 intercepted 8.3meters with weighted average gold grade of 2.68g/t, including high grade zone of one meter with 19.2g/t gold. Hole BMD29 intercepted 14 meters averaging 1.39g/t gold with enriched 3.7-meter zone having 3.16g/t gold average. Both intercepts confirmed the 30-meter strike continuity and 70-meter down-dip continuity from the surface by trench 8E,” said the announcement.

“These mineralized intercepts are hosted by sericite altered fine-grained volcanic and bounded by the altered/sheared meta-sediments (shale) at hanging wall & footwall. Quartz vein mineralization with randomly oriented dilatational form is associated with quartz-stock workings in the volcanic, suggesting hydraulic fracturing by an intrusive somewhere at depth.  Other holes drilled earlier with similar intercepts are aligned in a north-south trend, listed in table below.

“Another hole BMD06 which intercepted 5 meters of 1.86g/t gold from depths of 26 to 31 meters is located 300 meters south of holes BMD028 & BMD029.  It is located at the middle of the north-south trend with shallow intercept, Figure 1, and was also collared within the zones where previous trenches have proven low-grade gold mineralization or shallow oxide ore which is often amenable to free-digging mining method. Other holes with low gold intercepts of less than half a gram gold are mostly shallow, suggesting possible higher gold grade at depth for further follow-up drilling,” it added.

Hole ID From To Length (m) Au (g/t) Area
BMD06 26.00 31.00 5.00 1.86 Pit 2 E
BMD06 40.00 43.00 3.00 0.18 Pit 2 E
BMD09 56.81 59.11 2.30 0.90 Pit 2 E
BMD09 60.91 73.14 12.23 0.13 Pit 2 E
BMD14 34.98 38.41 3.43 0.66 Pit 2E
BMD16 44.60 45.20 0.60 1.21 Pit 6
BMD17 40.70 44.00 3.30 0.20 Pit 6
BMD20 0.00 6.50 6.50 0.34 Pit 1
BMD23 37.10 39.60 2.50 0.19 Pit 1
BMD24 0.50 5.50 5.00 0.57 Pit 1
BMD24 35.40 36.90 1.50 0.24 Pit 1
BMD25 1.00 3.00 2.00 0.27 Pit 1
BMD26 3.00 4.00 1.00 0.33 Pit 2 W
BMD26 9.40 14.00 4.66 0.26 Pit 2 W
BMD28 63.50 71.80 8.30 2.68 Pit 7
BMD29 58.70 72.90 14.20 1.39 Pit 7
BMD30 60.64 71.10 10.46 0.66 Pit 7

The trenches around the north-south trend have also consistently defined a roughly 600-meter long by 300-meter wide zone. Bordering around this main zone are smaller satellite zones that has overall estimated total shallow ore resource potential of up to 25,000 ounces gold. Below this shallow ore zone is a hard-rock ore proven by the two notable holes that may also extend even deeper as numerous tabular (fissure) ore bodies, shown in Figure 1 as the Bukit Ibam’s schematic geological setting, that could at least double the estimated shallow oxide ore resource potential.

Phase 2 drilling meterage to date is 2,188.7meters with last hole BMD31 pending assay result. Further drilling to prove the hard-rock resource continuities at depth and along strike is on-going, and hopes to delineate additional resource which can be presented under the accepted industry standards. Another announcement on the completion and results of the on-going exploration works will follow.

The above report was approved by the Company’s Chief Geologist Dr. Zakaria Endut who is  a qualified geologist holding a Doctorate from University Malaya and with a Bachelor Degree in Geology from University Kebangsaan Malaysia, with the assistance of external consultants under stringent industry practice standards. Presently he is the Chairman of the Economic Geology Working Group, Geological Society of Malaysia.

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