REG - Baron Oil PLC - Farm-Up Signed with Timor Gap

Baron OilAnnouncement

24/01/2024 07:15

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RNS Number : 6838A  Baron Oil PLC  24 January 2024

24 January 2024

Baron Oil Plc

("Baron", or the "Company")

 Farm-Up Signed with Timor Gap

Further to the Company's announcement on 18 December 2023, Baron Oil Plc (AIM:
BOIL) is pleased to announce that the farm-up agreements ("Farm-Up
Agreements") between Baron's wholly owned subsidiary SundaGas Banda
Unipessoal, Lda. ("SundaGas") and TIMOR GAP Chuditch Unipessoal Lda ("TIMOR
GAP") in relation to the TL-SO-19-16 Production Sharing Contract (the
"Chuditch PSC" or the "PSC"), offshore Democratic Republic of Timor-Leste,
have been signed.

The Farm-Up Agreements are now subject to a single condition precedent
("Condition Precedent"), that of approval of the Farm-Up by Timor-Leste's
National Petroleum Authority (Autoridade Nacional do Petróleo or "ANP").

The Baron Directors consider that the Farm-Up by TIMOR GAP has a value to
Baron of approximately US$8.5 million made up of a reimbursement for back
costs of c.US$1 million and in the offset of future spend which in 2024 is
estimated to be around US$7.5 million. The cash payments from TIMOR GAP
relating to back costs will be finalised upon Completion and will be paid to
Baron within 30 days of the Completion date.

The operational plan remains to drill and flow test the Chuditch-2 appraisal
well in late 2024, subject to rig and drilling services availability and the
completion of drill financing.

Terms of the Farm-Up

On completion of the Farm-Up ("Completion"), SundaGas, will retain
operatorship and hold a 60% working interest in the Chuditch PSC, while TIMOR
GAP will have a 40% interest, made up of a new paying 15% interest, plus its
original 25% interest which is carried to first gas. From Completion, TIMOR
GAP will be responsible for paying 20% of all costs, including the drilling of
the planned Chuditch-2 appraisal well.

The transfer of the 15% working interest from SundaGas to TIMOR GAP will not
occur until the sole Condition Precedent has been fulfilled.

The Farm-Up Agreements are governed by the laws of Timor-Leste.

If the Condition Precedent has not been satisfied or waived before 00:00 hours
in Dili on 31 March 2024 ("Long Stop Date"), then, the Farm-Up Agreements may
be terminated by either party at any time prior to the satisfaction or waiver
of the Condition Precedent.

Andy Yeo, Chief Executive of Baron Oil Plc, commented:

"We're delighted to have now signed the documents to increase TIMOR GAP's
participation in the Chuditch PSC through the assignment of a paying interest.
The expedited preparation and execution of these agreements demonstrates our
excellent working relationship, and we thank TIMOR GAP for their engagement in
our overall combined efforts to progress the Chuditch PSC."

For further information, please
contact:

Baron Oil
Plc
+44 (0) 20 7117 2849

Andy Yeo, Chief Executive

 

Allenby Capital
Limited                                +44 (0)
20 3328 5656

Nominated Adviser and Joint Broker

Alex Brearley, Nick Harriss, George Payne (Corporate Finance)

Kelly Gardiner, Stefano Aquilino (Sales and Corporate Broking)

 

Cavendish Capital Markets Limited             +44 (0) 131 220 6939
/ +44 (0) 207 397 8900

Joint Broker

Neil McDonald, Pearl Kellie (Corporate Finance)

Leif Powis (Sales)

 

IFC Advisory Limited
                        +44 (0) 20 3934 6630

Financial PR and
IR
baronoil@investor-focus.co.uk

Tim Metcalfe, Florence Chandler

 

 

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