REG - Block Energy PLC - Secured Loan Facility & Related Party Transactions
02/02/2023 07:00
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RNS Number : 6511O Block Energy PLC 02 February 2023
2 February 2023
Block Energy plc
("Block" or the "Company")
Secured Loan Facility & Related Party Transactions
Block Energy plc, the production and development company focused on Georgia,
is pleased to announce it has closed a senior secured loan facility ("Loan
Facility") of USD 1.06 million (c. £0.86 million at 1 February 2023), with
various existing shareholders and members of Block's management team.
The funds raised provide the Company with additional headroom to accelerate
its Project I development programme. This includes additional wells and
side-tracks, following completion of well WR-B01Za, which is currently being
drilled.
The Loan Facility is for a term of 18 months, commencing 2 February 2023, at
which point the principal is repayable in full. The loan carries an interest
rate of 16% p.a., payable quarterly in arrears in cash. The Company can
elect to repay amounts outstanding under the Loan at the end of each quarter,
in part or in full, subject to a 2% early repayment fee.
A debenture has been provided by the Company to the lenders as security,
providing a fixed and floating charge over the Company's property and assets.
Each lender will receive warrants exercisable at any point during the three
years from the Closing Date. The exercise price of each warrant shall be 1.7
pence per ordinary share. The number of warrants to be issued to each lender
shall correspond to an exercise value equal to 50% of their respective loan
commitment under the Loan Facility ("Warrant Value"). Therefore, the number of
warrants to be issued to lenders as part of the USD 1.06 million loan in
aggregate is 25,330,249.
The loan facility can be increased up to a maximum of USD 2.00 million during
the term of the loan, from the USD 1.06 million already committed, with the
existing lenders having a right of first refusal for a period of 20 business
days to participate in any extension.
Related Party Transactions
The Company's Chief Executive Officer, Paul Haywood has provided USD 90,000 of
the Loan, and its current Chief Operating Officer and former board director,
Ken Seymour, has provided USD 100,000 of the Loan.
Mr Haywood and Dr Seymour are each treated as a related party of the Company
pursuant to the AIM Rules. Consequently, the participation of Mr Haywood and
Mr Seymour in the provision of the Loan Facility constitutes a related party
transaction for the purposes of AIM Rule 13.
The Independent Directors (being Jeremy Asher and Philip Dimmock), consider,
having consulted with SPARK Advisory Partners Limited, the Company's nominated
adviser, that the terms of the related parties' participation in the Loan
Facility are fair and reasonable insofar as Shareholders are concerned.
Commenting, Phil Dimmock, Chairman of Block Energy plc, said:
"The Loan Facility will allow Block to accelerate its Project I development
programme, with the aim of increasing near-term cashflows, without the need
for dilutive financing. It also means Block can acquire long-lead items,
required for the drilling of additional sidetracks and wells on the West
Rustavi/Krtstanisi field. This Loan Facility strengthens our position going
into a busy 2023, when we aim to increase production from Project I and
progress our other three Projects."
**ENDS**
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER
THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF
ENGLISH LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, AS AMENDED. ON
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS
INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.
For further information please visit http://www.blockenergy.co.uk/
(http://www.blockenergy.co.uk/) or contact:
Paul Haywood Block Energy plc Tel: +44 (0)20 3468 9891
(Chief Executive Officer)
Neil Baldwin Spark Advisory Partners Limited Tel: +44 (0)20 3368 3554
(Nominated Adviser)
Peter Krens Tennyson Securities Tel: +44 (0)20 7186 9030
(Corporate Broker)
Philip Dennis / Mark Antelme / Ali AlQahtani Celicourt Communications Tel: +44 (0)20 8434 2643
(Financial PR)
Notes to editors
Block Energy plc is an AIM-listed independent oil and gas company focused on
production and development in Georgia, applying innovative technology to
realise the full potential of previously discovered fields.
Block has a 100% working interest in Georgian onshore licence blocks IX and
XI(B). Licence block XI(B) is Georgia's most productive block. During the
mid-1980s, production peaked at 67,000 bopd and cumulative production reached
100 MMbbls and 80 MMbbls of oil from the Patardzeuli and Samgori fields,
respectively. The remaining 2P reserves across block XI(B) are 64 MMboe,
comprising 2P oil reserves of 36 MMbbls and 2P gas reserves of 28 MMboe.
(Source: CPR Bayphase Limited: 1 July 2015). Additionally, following an
internal technical study designed to evaluate and quantify the undrained oil
potential of the Middle Eocene within the Patardzeuli field, the Company has
estimated gross unrisked 2C contingent resources of 200 MMbbls of oil.
The Company has a 100% working interest in licence block XI(F) containing the
West Rustavi onshore oil and gas field. Multiple wells have tested oil and gas
from a range of geological horizons. The field has so far produced over
75 Mbbls of light sweet crude and has 1.07 MMbbls of gross 2P oil reserves in
the Middle Eocene. It also has 38 MMbbls of gross unrisked 2C contingent
resources of oil and 608 Bcf of gross unrisked 2C contingent resources of gas
in the Middle, Upper and Lower Eocene formations (Source: CPR Gustavson
Associates: 1 January 2018, ERCE 2022).
In 2022, a Competent Person's Report provided by ERCE, ascribed 3P reserves of
3.01 million barrels, with an NPV project value of USD 57 million, to just a
portion of the West Rustavi/Krtsanisi Middle Eocene reservoir.
Block also holds 100% and 90% working interests respectively in the onshore
oil producing Norio and Satskhenisi fields.
The Company offers a clear entry point for investors to gain exposure to
Georgia's growing economy and the strong regional demand for oil and gas.
Glossary
· bbls: barrels. A barrel is 35 imperial gallons.
· Bcf: billion cubic feet.
· boe: barrels of oil equivalent.
· boepd: barrels of oil equivalent per day.
· bopd: barrels of oil per day.
· Mbbls: thousand barrels.
· Mboe: thousand barrels of oil equivalent.
· Mcf: thousand cubic feet.
· MMbbls: million barrels.
· MMboe: million barrels of oil equivalent.
· MMcf: million cubic feet.
Notification and public disclosure of transactions by persons discharging
managerial responsibilities ("PDMRs") and persons closely associated ("PCA")
with them.
1 Details of the person discharging managerial responsibilities / person closely
associated
a) Name Paul Haywood
2 Reason for notification
a) Position / status CEO
b) Initial notification Initial notification
/Amendment
3 Details of the issuer, emission allowance market participant, auction platform,
auctioneer or auction monitor
a) Name Block Energy plc
b) LEI 213800E2J8QA1J6KN415
4 Details of the transaction(s):
section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a) Description of the financial instrument, type of instrument Issue of warrants to acquire ordinary shares in Block Energy plc
Identification code ISIN GB00BF3TBT48
b) Nature of the transaction Grant of warrants as part of subscribing in the Loan Facility
c) Price(s) and volumes(s)
Price(s) Volumes
1.7p 2,150,682
d) Aggregated information n/a
e) Date of the transaction 2 February 2023
f) Place of the transaction Outside a trading venue
d)
Aggregated information
n/a
e)
Date of the transaction
2 February 2023
f)
Place of the transaction
Outside a trading venue
Notification and public disclosure of transactions by persons discharging
managerial responsibilities ("PDMRs") and persons closely associated ("PCA")
with them.
1 Details of the person discharging managerial responsibilities / person closely
associated
a) Name Kenneth Seymour
2 Reason for notification
a) Position / status Chief Operating Officer (PDMR)
b) Initial notification Initial notification
/Amendment
3 Details of the issuer, emission allowance market participant, auction platform,
auctioneer or auction monitor
a) Name Block Energy plc
b) LEI 213800E2J8QA1J6KN415
4 Details of the transaction(s):
section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a) Description of the financial instrument, type of instrument Warrants to acquire ordinary shares in Block Energy plc
Identification code ISIN GB00BF3TBT48
b) Nature of the transaction Grant of warrants as part of subscribing in the Loan Facility
c) Price(s) and volumes(s)
Price(s) Volume
1.7p 2,389,646
d) Aggregated information n/a
e) Date of the transaction 2 February 2023
f) Place of the transaction Outside a trading venue
d)
Aggregated information
n/a
e)
Date of the transaction
2 February 2023
f)
Place of the transaction
Outside a trading venue
Notification and public disclosure of transactions by persons discharging
managerial responsibilities ("PDMRs") and persons closely associated ("PCA")
with them.
1 Details of the person discharging managerial responsibilities / person closely
associated
a) Name Fergus Robson
2 Reason for notification
a) Position / status Commercial Manager (PDMR)
b) Initial notification Initial notification
/Amendment
3 Details of the issuer, emission allowance market participant, auction platform,
auctioneer or auction monitor
a) Name Block Energy plc
b) LEI 213800E2J8QA1J6KN415
4 Details of the transaction(s):
section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a) Description of the financial instrument, type of instrument Warrants to acquire ordinary shares in Block Energy plc
Identification code
ISIN GB00BF3TBT48
b) Nature of the transactions Grant of warrants as part of subscribing in the Loan Facility
c) Price(s) and volumes(s)
Price(s) Volume
1.7p 477,929
d) Aggregated information n/a
e) Date of the transactions 2 February 2023
f) Place of the transactions Outside a trading venue
d)
Aggregated information
n/a
e)
Date of the transactions
2 February 2023
f)
Place of the transactions
Outside a trading venue
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