Alistair,
I hope this message finds you well. I am writing to transmit the attached OFAC and Sanctions Compliance Memorandum prepared by Calderwood & Harkness LLP (Matter No. 1016-00003) in connection with the proposed offering by Dunmore Energy Holdings Ltd. and Dunmore upstream Finance Corp. of $850,000,000 aggregate principal amount of 9.375% Senior Secured Notes due 2032. The memorandum has been finalized following completion of the comprehensive sanctions screening conducted by Sandoval Compliance Solutions LLC (Rosa Medina, Managing Director) on April 25, 2025.
By way of summary, the memorandum analyzes sanctions exposure under OFAC regulations — including the Specially Designated Nationals and blocked Persons List (SDN List) and the Sectoral Sanctions Identifications List (SSI List) — the EU Consolidated Sanctions List, and the UK Office of Financial Sanctions Implementation (OFSI) Consolidated List, in each case as they relate to Dunmore's operations in Nigeria (OML 47 and OML 63, Niger Delta) and Senegal (Cayar Offshore Block). Sandoval screened all Dunmore group entities, their respective officers and directors, material counterparties (including the Nigerian National Petroleum Company, which holds back-in rights in OML 47 and OML 63), and joint-venture partners. The screening was completed on April 25, 2025, and returned no hits across all four sanctions lists. The memorandum also specifically addresses the Guarantor subsidiaries — Dunmore Nigeria E&P Ltd. and Dunmore Senegal S.A. — and their respective operational counterparties, with the same clean results.
Based on the screening results and the analysis set forth in the memorandum, we have drafted sanctions-related representations and covenants for inclusion in both the Indenture (with Northgate Trust Company, N.A., as Trustee and Collateral Agent) and the Purchase Agreement (with Ridgeline Capital Markets LLC, Clarion Securities Inc., and Pinnacle Partners LLC, as Initial Purchasers). The representations include: (i) confirmation that no Issuer, Guarantor, or any director, officer, or affiliate thereof is a Specially Designated National or blocked Person under OFAC regulations, or is listed on the EU Consolidated Sanctions List or the UK OFSI Consolidated List; (ii) a covenant that the proceeds of the Notes will not be used, directly or indirectly, in violation of OFAC sanctions, applicable anti-money laundering laws, or anti-corruption statutes (including the U.S. Foreign Corrupt Practices Act and the UK Bribery Act 2010); and (iii) an ongoing compliance covenant requiring maintenance of policies and procedures reasonably designed to promote and achieve continued compliance with applicable sanctions laws. These representations are consistent with current market practice for Rule 144A/Regulation S high-yield offerings by issuers with operations in West Africa. I would also note that Harrison Cates at Whitfield Baxter & Cohn LLP, counsel to the Initial Purchasers, has indicated that his team will want to review these representations and may request supplemental representations via a separate side letter. We anticipate this request and have prepared a draft Side Letter on Sanctions Representations for that purpose, which we can circulate once we have Dunmore's sign-off on the underlying representations.
I would like to formally request that you and your team review the sanctions representations as highlighted in the attached memorandum and, separately, in the marked sections of the draft Indenture and Purchase Agreement that Eric Johannsen circulated earlier this week. In particular, we ask that Dunmore confirm the factual accuracy of the representations with respect to: (a) Dunmore's and each Guarantor subsidiary's compliance history with OFAC, EU, and UK sanctions regimes; (b) the absence of any past or pending OFAC enforcement actions, voluntary self-disclosures, or investigations involving Dunmore or any of its subsidiaries; and (c) the completeness of the counterparty and joint-venture partner list provided to Sandoval for purposes of the screening. We would also appreciate written confirmation — an email response is sufficient for these purposes — that Dunmore's management is comfortable executing the Officers' Certificate at closing (to be signed by Marcus Ellingham, as Chief Executive Officer, and Deepa Rajaram, as Chief Financial Officer) certifying the accuracy of these representations as of the closing date.
On a related note, the Offering Memorandum will include specific risk-factor disclosure regarding sanctions and anti-corruption risks arising from Dunmore's Nigerian and Senegalese operations. Claire Dempsey is finalizing this draft language and is coordinating it with the broader OM disclosure timeline. As the Preliminary Offering Memorandum ("Red") is scheduled for distribution to the Initial Purchasers on Monday, April 28, we would very much appreciate receiving Dunmore's comments on the sanctions representations by end of day tomorrow, Sunday, April 27, if at all possible. I recognize this is a tight turnaround over a weekend, and I appreciate your flexibility.
Finally, I wanted to flag that we will be providing a separate memorandum outlining recommended post-closing quarterly OFAC and sanctions screening obligations applicable to Dunmore and the Guarantor subsidiaries. We expect to deliver that memorandum closer to closing, but I raise it now for your awareness and planning purposes. Given the nature of Dunmore's operations in Nigeria and Senegal, we would also recommend that Dunmore consider establishing a formalized internal sanctions compliance protocol for ongoing monitoring of counterparties and joint-venture partners in those jurisdictions.
I am available by phone or email throughout the weekend should you wish to discuss any aspect of the memorandum or the representations. If you or Deepa have detailed questions about the screening methodology or the specific databases and algorithms employed by Sandoval, I am happy to arrange a call with Rosa Medina directly.
Best regards,
Jennifer Kwon Partner, Capital Markets Calderwood & Harkness LLP 425 Lexington Avenue, New York, NY 10017 D: +1 (212) 558-7241 jkwon@calderwoodharkness.com
Attachments: 1. OFAC and Sanctions Compliance Memorandum (Calderwood & Harkness LLP, dated April 26, 2025) 2. Sanctions Screening Results Summary (C&H analysis of Sandoval Compliance Solutions report, screening completed April 25, 2025) 3. Counterparty and JV Partner Sanctions Checklist (.xlsx — pass/fail results)
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