REG - Chariot Limited - Partnership Agreements Signed with Energean plc

ChariotAnnouncement

07/12/2023 07:00

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RNS Number : 0120W  Chariot Limited  07 December 2023

 

7 December 2023

 

Chariot Limited

("Chariot", the "Company" or the "Group")

 

Partnership Agreements Signed with Energean plc on Moroccan Offshore Licences

 

Focused on delivery and expansion of Anchois gas development project

 

Chariot Limited (AIM: CHAR), the Africa focused transitional energy group,
is pleased to announce that it has signed Partnership Agreements with Energean
plc group ("Energean") (LON: ENOG), on the Lixus Offshore licence ("Lixus"),
where the Anchois gas development project ("Anchois") is located, and on the
Rissana Offshore licence ("Rissana") in Morocco.

 

Partnering Rationale:

 

·      Provides funding for both Chariot and the project through upfront
consideration, deferred consideration and potentially a full carry to first
gas, with Chariot retaining a material stake in the project

 

·      Secures an experienced operator for the development of Anchois -
Energean is a FTSE 250 company with a proven track record in successfully
developing large offshore gas projects

 

·      Accelerates growth from the portfolio, with the potential to
significantly upscale the development and target further exploration
prospectivity in the Lixus and Rissana licences

 

Project Development:

 

·      Leveraging their combined expertise to co-develop Anchois, the
parties are aligned on the next steps for the project development, including:

 

o  Drill a further well, in the east of the Anchois field and conduct a gas
flow test in 2024, with rig contract negotiations advanced. Multi-objective
well:

 

§ Evaluate undrilled low-risk deeper sands, to potentially materially
increase the resource base for a development above 1 Tcf

 

§ Optimise development scheme through a production flow test

 

§ Provide a future producer well

 

o  Expansion of the existing offshore development plan, to accommodate
potentially significantly higher production

 

o  Finalise ongoing gas sales negotiations with focus on meeting Moroccan
energy needs

 

·      Progress exploration together across Lixus and Rissana, including
a 2024 seismic campaign

 

 

 

Key Deal Terms:

 

·      Energean to acquire 45% and 37.5% interests in the Lixus and
Rissana licences respectively, and take operatorship of both licences

 

·      Chariot will retain a 30% and 37.5% interest in Lixus and Rissana
respectively, with ONHYM maintaining a 25% stake in each licence

 

·      Chariot will receive:

o  US$10 million payable on completion of the transaction

o  US$15 million payable on Final Investment Decision ("FID")

o  US$85 million gross carry including:

§ All Lixus costs up to FID, including the additional Anchois well with a gas
flow test

§ Planned Rissana seismic acquisition costs separately capped at US$7 million

 

·      Following completion of the Anchois well, Energean will have the
right to acquire a further 10% of Chariot's equity in the Lixus licence for:

o  US$850 million gross development carry to first gas (including the US$85m
gross carry)

o  US$50 million 5-year zero coupon convertible loan note with a strike price
of £20 adjusted down for dividends or issuance of three million Energean
shares, at Chariot's option on FID

o  7% royalty payment on Energean's gas production revenues in excess of a
base hurdle on the realised gas price (post transportation costs)

 

·      Energean's carry of Chariot's costs is non-recourse, and has a
coupon of 7% over the one year Secured Overnight Financing Rate (SOFR), with
the carry including interest repayable from 50% of Chariot's future net sales
revenues from the Lixus licence

 

·      Completion of the transaction is subject to standard Moroccan
regulatory approvals

 

Dr Leila Benali, Minister of Energy Transition and Sustainable Development
commented: "This agreement is pivotal for the wider acreage offshore Morocco,
on its Atlantic coast, a key energy asset for the Kingdom. We welcome Energean
on these licences as the important investments will contribute greatly to the
monetisation of the country's resources and to our ambitious energy strategy.

 

Mrs Amina Benkhadra, General Director Office National des Hydrocarbures et des
Mines commented: "I would like to congratulate both parties on signing this
agreement. The discovery and extensive work to date has set an excellent
foundation on which the project can be developed and this partnership will now
be instrumental in financing and taking it through the next phase. We look
forward to working alongside Energean and Chariot in bringing the project to
first gas."

 

Mathios Rigas, CEO of Energean commented: "This is an exciting step in the
next stage of our development, one that can only enhance our position as the
pre-eminent independent natural gas producer listed in London. These assets
are particularly attractive as we understand the core geological, commercial
and political drivers of the region, we have a track record in developing
material gas resources prioritised for the domestic market and they are a
complementary fit with our broader portfolio, not least the potential for
surplus supply to other markets. We look forward to working with our partners
Chariot and ONHYM, and developing an outstanding resource for the benefit of
all parties, including Morocco and its people."

 

 

Adonis Pouroulis, CEO of Chariot commented: "In Energean, we have secured a
partner with a proven track record of rapidly building and delivering this
kind of offshore development. Energean also shares our view that Anchois and
its surrounding acreage offers significant upside potential and we are aligned
with our plans moving forward. The new partnership is a key step in bringing
the development of the Anchois field to reality and we are looking forward to
continuing the extensive work undertaken so far to reach Final Investment
Decision."

 

We are excited about the next phase of drilling which has the potential to
both unlock significant additional resources and upsize the production
profile. It is intended that this well will be used as a producer well when
development commences. We retain a material stake in this basin opening
opportunity where both parties are keen to optimise the project's
fundamentals, enable expansion and undertake further exploration. We also look
forward to drilling on our Loukos Onshore licence which is anticipated to
commence in early 2024."

 

Investor Webcast

Chariot will be hosting a webcast for investors at 10.00am GMT
today. Investors are able to register for the event ahead of time and can do
so by clicking on the below link. There will be a Q&A session at the end
and participants will be able to submit their questions during the webcast.

https://stream.brrmedia.co.uk/broadcast/65705f5f85e1630925165801
(https://stream.brrmedia.co.uk/broadcast/65705f5f85e1630925165801)

This announcement contains inside information for the purposes of Article 7 of
EU Regulation 596/2014, as retained in the UK pursuant to S3 of the European
Union (Withdrawal) Act 2018.

 

Enquiries

 

 Chariot Limited                                          +44 (0)20 7318 0450

 Adonis Pouroulis, CEO

 Julian Maurice-Williams, CFO

 Cavendish Capital Markets Plc (Nomad and Joint Broker)   +44 (0)131 220 9778

 Derrick Lee, Adam Rae

 Stifel Nicolaus Europe Limited (Joint Broker)            +44 (0) 20 7710 7760

 Callum Stewart, Ashton Clanfield
 Celicourt Communications (Financial PR)                  +44 (0) 20 7770 6424

 Mark Antelme, Jimmy Lea

 

NOTES FOR EDITORS:

 

About Energean

 

Established in 2007, Energean is a London Premium Listed FTSE 250 E&P
company with operations in eight countries across the Mediterranean and UK
North Sea. Since IPO, Energean has grown to become the leading independent,
gas-focused E&P company in the Eastern Mediterranean with a strong
production and development growth profile. The Company explores and invests in
new ideas, concepts and solutions to produce and develop energy efficiently,
at low cost and with a low carbon footprint.

 

www.energean.com (http://www.energean.com)

 

About Chariot

 

Chariot is an Africa focused transitional energy group with three business
streams, Transitional Gas, Transitional Power and Green Hydrogen.

 

Chariot Transitional Gas is focused on high value, low risk gas development
projects in Morocco, a fast-growing emerging economy, with a clear route to
early monetisation, delivery of free cashflow and material exploration upside.

 

Chariot Transitional Power is focused on providing competitive, sustainable
and reliable energy and water solutions across the continent through building,
generating and trading renewable power.

 

Chariot Green Hydrogen is partnering with TEH2 (80% owned by TotalEnergies,
20% by the EREN Group) and the Government of Mauritania on the potential
development of a 10GW green hydrogen project, Project Nour in Mauritania, and
are progressing pilot projects in Morocco.

 

The ordinary shares of Chariot Limited are admitted to trading on the AIM
under the symbol 'CHAR'.

 

https://chariotenergygroup.com (https://chariotenergygroup.com)

 

 

 

 

 

 

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