REG - Empyrean Energy PLC - Convertible Note Amendment

Empyrean EnergyAnnouncement

Tue 14:00

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20260414:nRSN4455Aa&default-theme=true

RNS Number : 4455A  Empyrean Energy PLC  14 April 2026

 

14 April 2026

This announcement contains inside information

 

Empyrean Energy PLC / Index: AIM / Epic: EME / Sector: Oil & Gas

 

Convertible Note Amendment

 

Empyrean Energy plc ("Empyrean" or the "Company"), the oil and gas exploration
and development company with interests in Australia, Indonesia, and the United
States is pleased to announce that it has reached agreement to amend key terms
under its existing Convertible Note.

 

Background

 

In December 2021, the Company announced that it had entered into a Convertible
Loan Note Agreement with a Melbourne-based investment fund (the "Lender"),
pursuant to which the Company issued a convertible loan note to the Lender and
received gross proceeds of £4.0 million (the "Convertible Note").

 

As announced in May 2022, the Company and the Lender then amended the key
repayment terms of the Convertible Note, which at that time included the right
by the Lender to redeem the Convertible Note within 5 business days of the
announcement of the results of the Jade well at Block 29/11. The face value of
the Convertible Note, including accrued interest, was reset to £3.3 million
with interest to commence and accrue at £330,000 per calendar month from 1
December 2022.

 

As announced in May 2023, the Company and the Lender reached agreement to
amend further key terms including a reduction in the face value of the
Convertible Note from £5.28 million (including interest accrued to the end of
May 2023) to £4.6 million. It was also agreed with the Lender that no
interest would accrue on the Convertible Note until 31 December 2023, with
interest accruing thereafter at a rate of 20% p.a. At that time, the
conversion price on the Convertible Note was also reduced from 8p to 2.5p per
Share. The agreed terms provided that upon a successful sale of the Company's
interest in Mako, Empyrean must redeem the face value of the Convertible Note
and pay the Lender the greater of (a) US$1.5 million or (b) 15% of the
proceeds such sale.

 

Changes Effective 1 April 2026

 

As announced in February 2026, Empyrean, Conrad Asia Energy Ltd ("Conrad"),
and its subsidiary, West Natuna Exploration Limited ("WNEL") executed a
detailed Shareholders Agreement ("SHA") which governs the ongoing relationship
between Conrad and Empyrean moving forward and also defined Empyrean's
participation in the Mako Project within a Special Purpose Vehicle ("SPV").
Under these agreements, Empyrean is entitled to 8.5% of all cash payments to
WNEL including revenue from gas sales from the Mako Gas Project in Indonesia
("Mako Project"). The agreements are subject to customary conditions
precedent, including approval from Indonesia's Ministry of Energy and Mineral
Resources.

 

In parallel with the restructure of Empyrean's participation in the Mako
Project, Empyrean has also been in discussions with the Lender with regards to
the Convertible Note, with the parties having now reached agreement on the
amended key terms to the Convertible Note, as follows:

 

1.    The interest on the Convertible Note (which has a face value £6.7m
including interest accrued to the end of March 2026) has been decreased from
20% per annum to 5% per annum for the period 1 April 2026 to 30 September
2026, with interest then reverting to 20% per annum from 1 October 2026.

2.     Empyrean is to maintain a minimum cash balance of £1.25 million
until such time as the Convertible Note is repaid.

 

All other terms of the Convertible Note and previous amendments remain in
place.

 

Empyrean CEO & Technical Director, Gaz Bisht, commented:

 

"This is a constructive and important step for Empyrean. The significant
reduction in the interest payable on the note over the next 6 months preserves
the Company's working capital while it assesses new acquisition opportunities
in the oil and gas sector and as the Mako Project is developed.

 

We appreciate the continued support of our Lender and remain focused on
delivering a broader balance sheet solution and unlocking value, particularly
in relation to the Mako Project.

 

As recently announced, Empyrean secured its ongoing participation in the Mako
Project through an SPV, which necessitated discussions with the Lender as to
any potential impact this has on the Convertible Note.

 

With cash payments of approximately $US 0.76 million due from WNEL in the
coming months (less the negotiated cash call payment of US$0.35m) and existing
free cash of $US 2.37 million (£1.76 million) at 31 March 2026 (unaudited),
the Company believes it has adequate working capital for a minimum of 18
months. Further, should a compelling new opportunity present itself the Lender
has indicated that it is open to discussions on revisiting the minimum cash
balance requirement, if it is agreed that part of those funds would be better
used toward a value accretive opportunity".

 

For further information please visit www.empyreanenergy.com
(http://www.empyreanenergy.com/)  or contact the following:

 

 Empyrean Energy plc                                               Tel: +61 (8) 6146 5325
 Gaz Bisht

 Cavendish Capital Markets Limited (Nominated Advisor and Broker)  Tel: +44 (0) 207 220 0500
 Neil McDonald

 Pearl Kellie

 AlbR Capital Limited (Joint Broker)                               Tel: +44 (0)20 7469 0930
 Colin Rowbury

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  MSCLZLFFQZLZBBD



            Copyright 2019 Regulatory News Service, all rights reserved