REG - Petroneft Resources - Financing Update

Petroneft ResourcesAnnouncement

15/12/2021 07:00

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RNS Number : 6636V  Petroneft Resources PLC  15 December 2021

15(th) December 2021

 

PetroNeft Resources plc ('PetroNeft' or 'the Company')

 

Financing Update

 

 

PetroNeft (AIM: PTR) an oil & gas exploration and production company,
operating in the Tomsk Oblast, Russian Federation, and 90% owner and operator
of Licence 67 and 50% owner and operator of Licence 61 provides the following
financing update.

 

Highlights

·    Reduction in Petrogrand loan to $2.3 million and all conditions now
satisfied to extend maturity for an additional year.

 

·    Agreement reached to extend the current term by 30 days to 15(th)
January 2022 due to on-going 3(rd) party refinancing negotiations.

Petrogrand Loan facility

In January 2018 PetroNeft agreed a loan facility for up to US$2 million with
Swedish company Petrogrand AB ("Petrogrand") secured on the assets of
PetroNeft. The loan facility was fully drawn down and was used to finance the
drilling of the successful C-4 well in 2018 and for general corporate
purposes. During 2019, the parties further agreed to an increase in the
facility by US$500,000 to US$2.5 million and a revised maturity date of 15th
December 2020. Terms included the potential entitlement to bonus payments of
US$2.5 million per Licence if either or both Licence 61 or Licence 67 are sold
before 31 December 2022. On the 15(th) December 2020, the maturity date was
further extended to 15(th) December 2021 under the following terms:

·    Extension to the Maturity date to 15(th) December 2021 at the same
interest rate.

·    Ten percent of the loan amount to be repaid in six equal instalments
from July through to December 2021.

·    Interest accrued and owing at that time was rolled up into the
outstanding principal amount.

·    Further extension possible to 15(th) December 2022 on payment of a
further 10% of outstanding loan amount by 15(th) December 2021.

·    Extension to the bonus payments timing by up to two years to 31(st)
December 2024.

PetroNeft has met all interest payments in full and in addition has now paid
the revised contracted amount of $574,430 (representing 20% of the principal),
reducing the principal to $2.3 million, which enables the facility to be
extended by a further 12 months to 15(th) December 2022.

PetroNeft is however negotiating the potential whole or partial refinancing of
this facility with a third party.  In the event that the refinancing occurs
before 15 January 2022, Petrogrands entitlement to bonus payments would remain
only until 31(st) January 2024.  If Petroneft is successful in renegotiating
the loan facility, it could significantly improve its debt position. If
agreement is not reached then the maturity date will revert to 15(th) December
2022 with other loan terms remaining.

 

David Sturt, CEO of PetroNeft Resources plc, commented:

"Since the loan facility was first put in place back in 2018 Petrogrand have
been very supportive of the company, providing the financial support on which
much of our progress has been based.   We are very pleased that Petrogrand
has provided us with an extension to enable the company to try and progress
alternative refinancing options. Whilst these discussions are advanced and
ongoing, there is no certainty that they will be successful.  Should they not
prove successful we are happy to have the continued support in place from
Petrogrand for another year, if required.

We are grateful and reassured by the continued confidence and support shown by
Petrogrand in our performance and future plans for our assets."

 

 For further information, contact:

 David Sturt, CEO, PetroNeft Resources plc       +44 7903 869 608
 John Frain/Ciara O'Mongain, Davy (NOMAD and     +353 1 679 6363
 Broker)
 Joe Heron/Douglas Keatinge, Murray Consultants  +353 1 498 0300

 

 

 

 

 

 

 

 

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