REG - Ascent Resources PLC - Update on Slovenian JV partner negotiations

Ascent ResourcesAnnouncement

06/10/2022 10:45

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RNS Number : 0319C  Ascent Resources PLC  06 October 2022

This announcement contains inside information for the purposes of Article 7 of
the UK version of Regulation (EU) No 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon
the publication of this announcement via a Regulatory Information Service,
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6 October 2022

Ascent Resources plc

("Ascent" or the "Company")

Update on Slovenian JV partner negotiations

Ascent Resources Plc (LON: AST), the onshore Hispanic American and European
focussed energy and natural resources company, provides an update in relation
to its legacy disputes with its Slovenian JV Partner Geoenergo* and the JV
operating service provider Petrol Geo**.  Ascent considers Geoenergo and
Petrol Geo, given their common ownership, to be connected parties.

As previously announced on 2 August 2022, Ascent Slovenia Limited ("ASL") and
its Slovenian JV partner, Geoenergo, agreed ASL's entitlement to hydrocarbon
revenues produced from the PG-10 and PG-11A wells for the period April 2020
through to June 2022. ASL received a net payment of €650,560, as announced
on 12 August, relating to the 2020 and 2021 gas sales proceeds from the PG-10
and PG-11A wells less certain costs. The parties have agreed that ASL is
entitled to a €857,617 payment for the 1H 2022 gas sales revenues, which
accrues interest at a rate of 9% per annum while ASL awaits receipt of payment
of these agreed but outstanding amounts. Additionally, ASL has accrued a
further amount owed to it of circa €370,000 for production through Q3. The
current balance owed to ASL, as at end September, for the PG-10 and PG-11A
wells, is estimated to be circa €1,227,617 and this figure is expected to
increase monthly by approximately €100,000 / month assuming forward
production of 100,000scm/month and a gas price of €100/MWh.

ASL and Geoenergo have now completed the high court judge-supervised mediation
process and ASL has today initiated arbitration proceedings against Geoenergo
to seek a binding and enforceable resolution, which was not available through
mediation. The arbitration process is targeting immediate payment to ASL of
its share of the 2022 PG-10 and PG-11A hydrocarbon sales revenues agreed with
Geoenergo but currently withheld by it, the timely payment of all future
invoices, and a binding resolution on which wells are included in ASL's
revenue entitlement. ASL has a total claim in excess of Euro 4M and expects to
make material progress on this domestic arbitration process ahead of the year
end.

Once matters are resolved with Geoenergo, ASL expects to be able to rapidly
conclude disputed matters with Petrol Geo, the JV's operating service
provider. However, in the meantime, ASL expects during Q4 to enter into a
mediation process with Petrol Geo in relation to ASL's planned contractual
default, as announced 28 May 2020, relating to an amount of circa €230k owed
to Petrol Geo for services provided in 2019 as well as in relation to invoices
rejected by the JV on a monthly basis since April 2020, totalling circa
€1.4M.

*Geoenergo is a Slovenian operating company whose only asset is its interest
in the Petisovci license. Geoenergo is owned joint and equally by Nafta
Lendava d.d.o (a 100% directly Slovenian state-owned entity) and by Petrol
d.d. (a 30+% indirectly controlled state-owned publicly listed entity)

**Petrol Geo is a 100% owned subsidiary of Petrol d.d. (a 30+% indirectly
controlled state owned publicly listed entity).

Enquiries:

 Ascent Resources plc                        Via Vigo Communications

 Andrew Dennan
 WH Ireland, Nominated Adviser & Broker      0207 220 1666

 James Joyce / Sarah Mather
 Novum Securities, Joint Broker              0207 399 9400

 Jon Belliss

 

 

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