REG - ADM Energy PLC - JKT Reclamation Facility Operations Update

Adm EnergyAnnouncement

23/05/2024 07:00

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RNS Number : 5453P  ADM Energy PLC  23 May 2024

 

 

23 May 2024

 

 

ADM Energy PLC

("ADM" or the "Company")

 

JKT Reclamation Facility Operations Update

 

ADM Energy PLC (AIM: ADME; BER and FSE: P4JC), a natural resource investing
company, is pleased to provide the following update with respect to operations
of JKT Reclamation, LLC ("JKT"), the revenue and cash flow generating oil
reclamation business in which the Company owns a 30.6% economic interest.

Following ADM's investment in SW Oklahoma Reclamation, LLC, the parent company
of JKT (as announced on 8 April 2024), JKT has leased the following equipment
for the reclamation site: (1) a 550-barrel capacity mixing tank in order to
combine and agitate the processing fluids. Prior to this acquisition the
mixing of the fluids was done manually, therefore this purchase will
significantly increase the mixing capabilities in the reclamation process; and
(2) two new fluid pumps that are able to move 20 gallons per minute, which
will increase the movement of fluids between the different phases of the
reclamation process.

This new equipment will assist in increasing the processing capacity of the
JKT's reclamation facility in Wilson, Oklahoma and is scheduled to be
delivered and installed in early June 2024.

The gross barrels of oil produced at the facility from 1 January 2024, the
effective date of the JKT transaction, is as follows:

                                   Jan 2024  Feb 2024  Mar 2024  Apr 2024
 Gross Oil Volume Produced (bbls)  -         944       1,475     1,031

 

Following delivery and installation of the new equipment, JKT is targeting to
expand production to 3,500 to 4,000 barrels of oil per month. JKT has also
entered into a short-term working capital facility ("Facility") that allows
for short-term advances against oil sold, payable within 90 days, at a cost of
1.75% per month on the quantum of funds borrowed. The Facility will provide
JKT the short term funds required to expedite its growth.

Additionally, JKT has started evaluating properties for a second reclamation
facility in the State of Texas.  Further details regarding the second
reclamation facility will be provided in due course.

ADM is further pleased to announce that it has received its first cash
distribution from JKT in the amount of US$21,000.00.  The Company expects
cash distribution levels to grow with production in the coming months. The
Company will receive 42.0% of cash distributions until it has received
US$356,250.00 and 30.6% thereafter

Commenting on the monthly JKT operations update Stefan Olivier, CEO, stated:
"With the new equipment that has been purchased and will be installed in June
2024, we anticipate increased production, revenue and profitability with
growing net cash distributions."

 

Market Abuse Regulation (MAR) Disclosure

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 as it forms part of UK domestic law by virtue of the
European Union (Withdrawal) Act 2018 ('MAR'). Upon the publication of this
announcement via Regulatory Information Service ('RIS'), this inside
information is now considered to be in the public domain.

 

Enquiries:

 

 ADM Energy plc                                       +44 7495 779520
 Stefan Olivier, Chief Executive Officer
 www.admenergyplc.com (http://www.admenergyplc.com/)

 Cairn Financial Advisers LLP                         +44 20 7213 0880
 (Nominated Adviser)
 Jo Turner, James Caithie

 ODDO BHF Corporates & Markets AG                      +49 69 920540
 (Designated Sponsor)
 Michael B. Thiriot

 Gracechurch Group                                    +44 20 4582 3500
 (Financial PR)
 Harry Chathli, Alexis Gore, Henry Gamble

 

About ADM Energy PLC

ADM Energy PLC (AIM: ADME; BER and FSE: P4JC) is a natural resources investing
company with investments including a 30.6% economic interest in JKT
Reclamation, LLC; a 46.8% economic interest in OFX Technologies, LLC
(www.ofxtechnologies.com (http://www.ofxtechnologies.com) ); and a 9.2% profit
interest in the Aje Field, part of OML 113, which covers an area of 835km²
offshore Nigeria. Aje has multiple oil, gas, and gas condensate reservoirs in
the Turonian, Cenomanian and Albian sandstones with five wells drilled to
date.

 

About JKT Reclamation LLC

JKT Reclamation is the owner of a 20-acre facility in Wilson, Oklahoma with
fixed assets including a workshop and office structure, ten 410-barrel storage
tanks and other related separation and material handling equipment. In
addition to the property, plant and equipment, other assets include two
proprietary chemical formulae with additional potential commercial
applications. JKT management believe its proprietary chemicals give JKT two
key competitive advantages over other similar facilities because:

 

·    JKT's chemical-based process does not require use of a centrifuge,
which are expensive to operate and maintain, the operating costs required to
process and recover saleable oil are lower than they would be if a centrifuge
were employed in JKT's process; and,

 

·    JKT owns its chemical formulae, JKT does not have to purchase
similar, commercially available chemicals, resulting in substantial cost
savings to JKT.

 

JKT management believe the combination of these two advantages allows JKT to
achieve substantially higher operating profit margins than similar facilities
and that, long term, JKT can use this cost advantage to increase its market
share in its service area.

 

Forward Looking Statements

Certain statements in this announcement are, or may be deemed to be,
forward-looking statements. Forward looking statements are identified by their
use of terms and phrases such as "believe", "could", "should", "envisage'',
"estimate", "intend", "may", "plan", "potentially", "expect", "will" or the
negative of those, variations or comparable expressions, including references
to assumptions. These forward-looking statements are not based on historical
facts but rather on the Directors' current expectations and assumptions
regarding the Company's future growth, results of operations, performance,
future capital and other expenditures (including the amount, nature and
sources of funding thereof), competitive advantages, business prospects and
opportunities. Such forward-looking statements reflect the Directors' current
beliefs and assumptions and are based on information currently available to
the Directors.

 

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