REG - Electric Guitar PLC - Proposed acquisition: oil & gas assets in Oklahoma

Electric GuitarAnnouncement

29/04/2026 07:15

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RNS Number : 3744C  Electric Guitar PLC  29 April 2026

This announcement contains inside information as stipulated under the UK
version of the Market Abuse Regulation No 596/2014 which is part of UK Law by
virtue of the European (Withdrawal) Act 2018, as amended. Upon publication of
this announcement this information is considered to be in the public domain.

 

29 April 2026

 

Electric Guitar PLC

("Electric Guitar" or the "Company")

 

Proposed acquisition of oil and gas assets in Oklahoma

 

As announced on 30 March 2026, the Board of Electric Guitar PLC (the "Board")
is continuing discussions regarding the acquisition of Dunbar Energy Inc.
("Dunbar"), although this has been delayed by the changing nature of Dunbar's
asset base and structuring matters as Dunbar continues to develop its strategy
in the USA of behind-the-meter ("BTM") power from gas wells to local intensive
compute sites.

 

While discussions have been continuing with Dunbar, the Board has been
introduced to other complementary oil and gas assets to support the Company's
stated mission, and is pleased to announce the following new acquisition
opportunity.

 

Option to acquire oil and gas assets in Oklahoma

 

As set out today in an announcement made by ADM Energy PLC, an AIM-quoted
investing company ("ADM") and as described in more detail below, Electric
Guitar has entered into an option agreement to acquire all the membership
interests in Broadgate Midcon, LLC ("Broadgate") (the "Broadgate Option"),
conditional on Broadgate acquiring interests in certain oil and gas assets in
Oklahoma, USA (details of which are set out further below), subject to further
due diligence by the Company. The Broadgate Option is exercisable at Electric
Guitar's discretion at any time until 31 July 2026.

 

ADM, which is a natural resource investing company, has formed Vega Upstream
JV, LLC ("Vega Upstream JV") as a joint venture company with Covenant Oil
Group Corp. ("COG").

 

Vega Upstream JV has identified a portfolio of operated and non-operated
producing natural gas, natural gas liquids ("NGL") and oil wells in Oklahoma,
USA, together with a fee-generating natural gas gathering system and its
associated surface land and equipment (the "Midcon Assets"). Subsequently,
Vega Upstream JV has executed a Stock and Membership Interest Purchase
Agreement (the "Purchase Agreement") with the owner, a private US company (the
"Target"), to acquire all of the issued and outstanding share capital of the
Target and all of the issued membership interests in its subsidiaries, and the
Midcon Assets, for a base purchase price of c. USD 14.9 million (the "Purchase
Price").

 

On 28 April 2026, Vega Upstream JV paid a deposit of USD 500,000 (the
"Deposit") to execute the Purchase Agreement. The Deposit will be applied to
the Purchase Price at closing of the transaction, anticipated on or before 31
May 2026, with an effective date of 1 February 2026 (the "Midcon
Acquisition").

 

The Midcon Acquisition and associated due diligence and transaction expenses
are expected to be financed with an institutional credit facility of
approximately USD 14 million (the "Debt Financing") and an equity contribution
to Vega Upstream JV of USD 1 million (inclusive of the Deposit).

 

Vega Upstream JV is structuring the acquisition of the Target such that 50 per
cent. (by value) of the Target's operated upstream and midstream assets, but
excluding (i) its investments in non-operated upstream assets and (ii)
approximately 160 surface acres currently used for the compressor station and
main tank battery, will be owned by Broadgate, details of which are set out
below (the "Broadgate Assets").

 

Accordingly, if Electric Guitar decides to exercise the Broadgate Option, it
would own the Broadgate Assets, which would constitute a reverse takeover
pursuant to rule 14 of the AIM Rules for Companies ("RTO") and therefore would
be subject to, inter alia, approval by shareholders of Electric Guitar.

 

The exercise price of the Broadgate Option will be the amount of the Purchase
Price that is attributable to the Broadgate Assets plus costs; is not expected
to exceed USD 6 million; and will be subject to any adjustments at closing of
the Midcon Acquisition. The consideration for the exercise of the Broadgate
Option is expected to be satisfied predominately through Electric Guitar
assuming responsibility for a proportional amount of the debt financing used
to purchase the Midcon Assets, alongside some equity funding.

 

The parties have agreed an exclusivity period until 31 July 2026 with regard
to Electric Guitar's exercise of the Broadgate Option.

 

Details of the Broadgate Assets

 

The Broadgate Assets - described in ADM's announcement released earlier today
- are located in the Western Anadarko Basin of western Oklahoma and comprise
(i) upstream assets and (ii) midstream assets, that can be summarised as
follows:

 

1)    50 per cent. by value of the following operated upstream assets (the
"Operated Upstream Assets"):

 

Working interest of an average of 49.4 per cent. in 28 operated natural gas,
NGL and oil wells located in Custer County, Oklahoma, together with a defined
portfolio of 58 horizontal drilling locations, of which approximately 72 per
cent. are attributable to the Operated Upstream Assets.

 

Comprising recent net production of c. 3.2 million cubic feet equivalent per
day (533 barrels of oil equivalent per day) and approximately 58 per cent. of
revenue from crude oil and liquids.

 

2)    50 per cent. by value of the following midstream assets (the
"Midstream Assets"):

 

A natural gas gathering system transporting c. 4.4 million cubic feet per day
of natural gas produced by the Midcon Assets and 8 other area producers to the
sales point covering approximately 4 square miles, for a toll of USD 0.75 per
thousand cubic feet.

 

Further terms relating to the Broadgate Option

 

The Company has also agreed terms for collaboration between COG, ADM and
Electric Guitar in connection with the identification, negotiation, due
diligence and financing of the Midcon Acquisition and the Broadgate Option.

 

In the event that Broadgate is acquired by Electric Guitar with the Broadgate
Assets via the exercise of the Broadgate Option and conditional thereon, and
in consideration of COG's and ADM's roles in connection with the
identification, negotiation, due diligence and financing of the Midcon
Acquisition, the Broadgate Assets and the Broadgate Option, ADM and COG will
be entitled to:

 

i)             A total fee of USD 300,000, of which up to half may
at Electric Guitar's option be satisfied by the issue of new ordinary shares
of 0.01p in the Company ("Ordinary Shares") at the issue price of Ordinary
Shares at the time of the RTO (the "RTO Price"); and

 

ii)            A two-year warrant to subscribe for new Ordinary
Shares equal in total to 5 per cent. of the issued share capital of the
Company on completion of the RTO, at a subscription price 50 per cent. higher
than the RTO Price.

 

Next steps

 

The Board intends to continue to pursue the potential acquisition of Dunbar
(or certain of its assets) as well as the proposed acquisition of Broadgate
(with the Broadgate Assets), and to seek to utilise both acquisitions in
supporting the Company's overall strategy of acquiring BTM assets for locally
powering datacentres.

 

The proposed RTO will be subject to, inter alia, the completion of
satisfactory due diligence, regulatory approvals, the execution of final
legally binding documents, publication of an AIM Admission Document, approval
by shareholders of Electric Guitar at a general meeting of the Company of the
RTO and (if required) of a waiver of the obligations that would otherwise
arise under Rule 9 of the Takeover Code (also subject to approval by the
Takeover Panel), and re-admission of the Company's Ordinary Shares to trading
on AIM. There is therefore no guarantee that the proposed acquisition of
Broadgate or of Dunbar will proceed, nor as to their final terms or timing.
The Ordinary Shares remain suspended from trading on AIM in the meantime.

 

The Company will provide further updates as appropriate as matters progress.

 

 Contacts:

Electric Guitar PLC                                   info@electricguitarplc.com

 Richard Horwood

 Allenby Capital (Nominated Adviser and Joint Broker)  020 3328 5656

 Jeremy Porter / Alex Brearley

  AlbR Capital (Joint Broker)                          020 3026 0320

 Jon Belliss / Colin Rowbury

 

Important notices

 

This announcement may include statements that are, or may be deemed to be,
"forward-looking statements". These forward-looking statements can be
identified by the use of forward-looking terminology, including the terms
"anticipates", "aims", "expects", "may", "will", or "should" or, in each case,
their negative or other variations or comparable terminology. These
forward-looking statements include matters that are not historical facts. They
appear in a number of places throughout this announcement and include
statements regarding the directors' current intentions, beliefs or
expectations concerning, among other things, the Company's prospects, growth,
strategies and the Company's markets. By their nature, forward-looking
statements involve risk and uncertainty because they relate to future events
and circumstances. Actual results and developments could differ materially
from those expressed or implied by the forward-looking statements.
Forward-looking statements may and often do differ materially from actual
results. Any forward-looking statements in this announcement are based on
certain factors and assumptions. Whilst the directors consider these
assumptions to be reasonable based upon information currently available, they
may prove to be incorrect.

 

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