TIDMRBD
RNS Number : 0413K
Reabold Resources PLC
11 December 2018
11 December 2018
Reabold Resources Plc
("Reabold" or "the Company")
Corporate and Project Update
Reabold is pleased to provide the following updates across its
portfolio of projects and investments:
Highlights
-- Corallian's two well drilling campaign at Wick and Colter to commence this month
-- Reabold participating in a GBP912,300 Corallian fund raise to
help fund Curlew-A appraisal well
-- Significant options granted to Reabold for further investment into Danube Petroleum
-- Further West Brentwood drilling prioritised ahead of Monroe
Swell due to heavy rain at Monroe Swell
-- West Newton A-2 well on track to drill in Q1 2019
Corallian Energy ("Corallian")
As previously announced, Corallian, in which Reabold owns a 32.9
per cent. equity interest, anticipates that its two well drilling
campaign will commence this month. The Ensco-72 Jack-Up rig will be
initially mobilised to the Inner Moray Firth to drill the Wick
prospect. Following completion of this well, the same rig will
subsequently be mobilised to the south of England to drill the
Colter prospect.
Corallian has also made considerable progress on the rest of its
UK portfolio, including the farm out of 10 per cent. of the
Curlew-A prospect to Talon Petroleum (UK) Limited as announced on
26 October 2018. Talon will pay 15 per cent. of the anticipated
well cost to earn its 10 per cent. interest. Curlew-A has 2C
unrisked contingent resource of 44.7 million barrels of oil
equivalent.
As part of the overall funding of the Curlew well, which
Corallian plans to drill in H2 2019, Corallian has raised
GBP912,300 by way of an advanced subscription agreement. Reabold is
participating in this fund raise with an investment of GBP300,000,
maintaining its 32.9 per cent. equity interest. The additional
shares to be issued under the advanced subscription agreement are
priced at the higher of either a 30 per cent. discount to the price
achieved in the next Corallian funding round, or at GBP1.50 per
share (in line with the price per share at the last fund raise) if
no funding round has occurred within 12 months.
Danube Petroluem ("Danube")
Danube Petroleum, in which Reabold holds 1,879,700 ordinary
shares representing a 33 per cent. equity interest, has made
further progress on the Parta Appraisal Drilling and Development
Operations. The manufacturing of key long lead items, including
casing, tubing and wellheads, which are due for completion in mid
February 2019, has commenced. In addition, efficient progress is
being made with permitting for the drilling of the two wells both
at a ministerial and local government level. Progress to date
provides a high level of confidence that all relevant permits and
authorisations will be granted during Q1 2019. The timing of
completion of permitting and the availability of long lead items is
expected to meet the scheduled timing of a firm drilling rig slot
in Q1 2019 as previously announced under a drilling contract that
was signed in October 2018 for one firm well and one option
well.
As announced, in conjunction with the exercise of Reabold
options to invest into Danube, Reabold and ADX Energy Ltd ("ADX")
have been discussing the timing of the ADX commitment to invest
GBP375,940, either directly or via a third party, at GBP1.00 per
share. This is the price per share at which all Reabold investments
have taken place to date into Danube Petroleum.
As a result of this process, Reabold and ADX have agreed to
extend the deadline for this investment, and have agreed the
following funding commitments and options:
1. Under the terms of the Subscription Agreement, ADX has
committed to either invest directly or source investment from a
third party for GBP375,940 on the same terms as Reabold's
investments prior to 15 March 2019 (@GBP1.00 per share). In the
event that ADX does not complete (or procure a third party to
complete) the ADX Investment by 15 March 2019, ADX agrees to grant
Reabold the right to subscribe to the shares at an issue price of
GBP0.80 per Danube share.
2. Reabold will have the option to subscribe to a further
375,940 Danube shares at an issue price of GBP1.00 per share at any
time prior to 15 March 2019.
In addition to the above, Reabold and ADX have agreed to grant
the following options to subscribe for shares in Danube in order to
provide funding for the second Parta Appraisal Well ("Second Parta
Well Funding"):
1. Reabold may subscribe for a further 1,627,604 Danube shares
at an issue price of GBP1.20 per share by electing to do so within
six weeks of receipt of well logging data from the final logging
run on the First Parta Appraisal Well. The monies raised by Daunbe,
should Reabold elect to subscribe for these shares, would be
GBP1,953,125
2. ADX may subscribe for a further 651,042 Danube shares at an
issue price of GBP1.20 per share by electing to to do so within six
weeks of receipt of well logging data from the final logging run on
the First Parta Appraisal Well. The monies raised by Daunbe, should
ADX elect to subscribe for these shares, would be GBP781,250.
3. Reabold and ADX may exercise their respective options to
acquire shares up to a value of GBP1,953,125 for Reabold and
GBP781,250 for ADX at any time prior to the spudding of the First
Parta Well at a subscription price of GBP1.00 per Danube share
rather than GBP1.20 per Danube share.
The agreed funding options provide a framework to fund the
drilling, testing and completion for production of the two planned
Parta Appraisal wells. Assuming the above funding options are
exercised, up to GBP4,910,225 (ca USD 7 million) of funds would be
provided to Danube by the parties. If the Second Parta Well Funding
is subscribed for at a price of GBP1.20 per share, Reabold would
hold a 45 per cent. shareholding in Danube and ADX would hold a 55
per cent. shareholding in Danube.
Reabold California
Integrity Management Solutions ("Integrity"), contract operator
of the California assets in which Reabold has an interest, has
informed the Company that whilst significant amounts of work have
now taken place at the Monroe Swell drilling site, severe rainfall
in California has rendered access to the site difficult for the
heaviest equipment, which is hindering the ability to spud the
well. Whilst a period of drier weather may quickly improve
conditions sufficiently to allow access to the well, it remains
uncertain as to exactly when this will occur.
As a result, Integrity will mobilise the rig to the West
Brentwood site first, where it will drill the follow up to the
successful VG-3 well before returning to Monroe Swell immediately
afterwards. The next West Brentwood well will be drilled from the
same pad that was constructed for the drilling of VG-3. The pad and
the access road at West Brentwood were high graded to allow
operations in winter weather conditions and Integrity does not
expect any access issues. Reabold will update the market on
spudding of the next West Brentwood well, which Integrity is
targeting within the next few weeks.
Rathlin Energy
Following completion of Reabold's investment into Rathlin
Energy, work has now commenced at the West Newton A site ahead of
drilling the West Newton A-2 well in Q1 2019. The second cellar on
the site is due to be constructed prior to Christmas to allow
conductor setting operations to take place in January 2019.
Sachin Oza, co-CEO, commented:
"We are very pleased to increase our stake in both Corallian and
Danube where significant operational progress continues to be made.
The considerable optionality that we have negotiated for additional
investment into Danube is reflective of the type of deals that
Reabold seeks in order to create shareholder value.
"While disappointing that exceptionally high rainfall has
delayed the drilling of Monroe Swell we look forward to the
drilling of the next West Brentwood well and our other near term,
high value drilling projects. "
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) 596/2014.
S
For further information please contact:
Reabold Resources plc c/o Camarco
Stephen Williams +44 (0) 20 3757 4980
Sachin Oza
Strand Hanson Limited (Nominated
and Financial Advisor)
Rory Murphy / James Spinney /
James Dance +44 (0)20 7409 3494
Camarco
James Crothers
Ollie Head
Billy Clegg +44 (0) 20 3757 4980
Whitman Howard Limited - Joint
Broker
Nick Lovering
Grant Barker +44 (0) 20 7659 1234
Turner Pope Investments (TPI)
Ltd - Joint Broker
Andy Thacker +44 (0) 20 3621 4120
Notes to Editors
Reabold Resources plc is an investing company investing in the
exploration and production ("E&P") sector. The Company's
investing policy is to acquire direct and indirect interests in
exploration and producing projects and assets in the natural
resources sector, and consideration is currently given to
investment opportunities anywhere in the world.
As an investor in upstream oil & gas projects, Reabold aims
to create value from each project by investing in undervalued,
low-risk, near-term upstream oil & gas projects and by
identifying a clear exit plan prior to investment.
Reabold's long term strategy is to re-invest capital made
through its investments into larger projects in order to grow the
Company. Reabold aims to gain exposure to assets with limited
downside and high potential upside, capitalising on the value
created between the entry stage and exit point of its projects. The
Company invests in projects that have limited correlation to the
oil price.
Reabold has a highly-experienced management team, who possess
the necessary background, knowledge and contacts to carry out the
Company's strategy.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
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of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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