REG - Prospex Energy PLC - £565,000 Issuance of Convertible Loan Notes

Prospex EnergyAnnouncement

19/12/2025 07:00

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RNS Number : 2070M  Prospex Energy PLC  19 December 2025

Prospex Energy PLC / Index: AIM / Epic: PXEN / Sector: Oil and Gas

 

THIS ANNOUNCEMENT IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION,
DISTRIBUTION OR FORWARDING, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR
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DISTRIBUTION WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS NOT AN OFFER OF
SECURITIES IN ANY JURISDICTION.  PLEASE SEE THE IMPORTANT NOTICES AT THE END
OF THIS ANNOUNCEMENT.

 

The communication of this announcement, and any other documents or materials
relating to the Proposed Fundraise and the Loan Notes is not being made, and
such documents and/or materials have not been approved, by an authorised
person for the purposes of section 21 of the Financial Services and Markets
Act 2000.  Accordingly, such documents and/or materials are not being
distributed to, and must not be passed on to, the general public in the United
Kingdom.  The communication of such documents and/or materials as a financial
promotion is only being made to, and may only be acted upon by, those persons
in the United Kingdom falling within the definition of investment
professionals (as defined in Article 19(5) of the Financial Services and
Markets Act 2000 (Financial Promotion) Order 2005 (the "Financial Promotion
Order")) or persons who are within Article 43 of the Financial Promotion Order
(being existing members or creditors of the Company) or any other persons to
whom it may otherwise lawfully be made under the Financial Promotion Order.

 

19 December 2025

 

Prospex Energy PLC

('Prospex' or the 'Company')

 

£565,000 Issuance of Convertible Loan Notes

Proposed Fundraise of up to £1.6 million to Support Portfolio Capital
Expenditure

 

Prospex Energy PLC (AIM: PXEN), the AIM-quoted investment company focused on
European gas and power projects, announces that it has issued £565,000 in
unsecured Convertible Loan Notes ('the Loan Notes') to existing and new
investors ('the Subscribers'), including all of the directors of the Company.

 

The Company will now offer any existing shareholders and qualified investors
the opportunity to participate in the Loan Notes on the same terms, for a
total subscription (including the £565,000 received to date) of up to £1.6
million.  The offer will remain open until 9 January 2026.  Further details
on how to subscribe to the Loan Notes can be found below.

 

Highlights

·    £565,000 raised via the issue of unsecured Convertible Loan Notes of
£1 each, due at the end of June 2028.  Offer remains open until 9 January
2026 to raise up to £1.6 million.

·    The Loan Notes are convertible at 3p per ordinary share at any time at
the election of the investor.

·    Interest at 12% per annum is payable quarterly, with the first two
interest payments on 31 March 2026 and 30 June 2026 to be capitalised and
added to the loan principal rather than paid in cash.

·    Loan principal to be repaid in three tranches at the end of December
2027, the end of March 2028 and the end of June 2028.  Forecast increased gas
production from the drilling campaigns on all three of the Company's
production concessions is expected to cover the capital repayments.

·    Net proceeds will be used to support the Company's ongoing activities,
including current and future capital expenditure requirements.

·    Ongoing operational costs and overheads continue to be met from
production income generated by the Company's strategic asset portfolio.

 

Mark Routh, Prospex's CEO, commented:

"The proceeds of the Loan Notes will mostly be used to fund the Company's 37%
share of the 3D seismic acquisition on the Selva Malvezzi production
concession in Italy.  A minimum of £800,000 is required to cover the cash
calls in respect of this asset received and to be received from the operator.
 £300,000 of the fund raise to is cover the commitment for a new transformer
at the El Romeral power plant in southern Spain which is on order for delivery
later in 2026.  The balance of the £200,000 cash call from HEYCO Energy
Group, Inc. to fund the Viura asset which was due in June 2025 is to be
transferred into the Loan Notes.

 

"The Company believes it has a diverse and highly prospective investment
portfolio with the potential to deliver significant value over time and, on
this basis, encourages shareholders to consider participating in the offer of
the Loan Notes."

 

Use of Funds and Structure

The funds raised from the issue of these Loan Notes is to fund the ongoing
growth of the Company and its current and future capital expenditures.
 Ongoing operational expenditures and overheads are covered from production
income from the Company's portfolio of assets.

 

The £565,000 Loan Notes issued to date comprises the following:-

·    £300,000 in new cash from directors and existing shareholders,

·    £200,000 of Loan Notes have been issued to HEYCO Energy Group, Inc.
to fulfil the balance of the June cash-call on Viura, which the Company did
not pay at the time, and

·    £65,000 of Loan Notes issued to cover a cash advance to cover the
deposit on ordering a new transformer at El Romeral.

The Company will accept further Loan Note subscriptions up to a total of £1.3
million (including the £565,000 committed to date) to cover:-

·    £235,000 to fund the balance of the cost of the new El Romeral
transformer in Q3-2026

The Company will accept further Loan Note subscriptions up to a maximum £1.6
million for general corporate purposes including contingency and costs.

 

Selva Malvezzi

£800,000 of the net proceeds of this fund raise is to provide funds towards
the Company's share of development costs at the Selva Malvezzi concession, in
the Po Valley in Italy, which includes cash calls under the Joint Operating
agreement received and to be received from the operator to cover the Company's
share of the costs of the 3D seismic acquisition programme which completed
last month.

 

Viura

£200,000 of the issuance is to meet the balance of the June cash-call on
Viura in northern Spain which was not fulfilled by the fund raise in June
2025.  HEYCO Energy Group, Inc. has agreed that this £200,000 is to be
converted into the Loan Notes.

 

Tarba - El Romeral

A total of £300,000 of the net proceeds is to meet the cost of a new
transformer at the El Romeral power plant in Carmona southern Spain, which is
due for delivery in 6-8 months, which is when the final payment of £235,000
will become due.  The transformer was ordered in November and a 20% deposit
of £65,000 has already been paid and converted into the Loan Notes.

 

Further Information on the Subscribers and the Loan Note

The Loan Notes will pay 12% interest per annum quarterly, with the first two
quarterly interest payments on 31 March 2026 and 30 June 2026 to be
capitalised and added to the loan principal rather than paid in cash.
 Quarterly cash interest payments will be made thereafter with the first
payment on 30 September 2026.  Unless converted, the Loan Note principal is
to be repaid in three equal capital repayments scheduled at the end of
December 2027, the end of March 2028 and the end of June 2028.  Forecast
increased gas production from the drilling campaigns on all three of the
Company's production concessions is expected to cover the capital repayments.

 

The Company can elect to pay the interest in Euros by giving 10 business days'
notice.  The Company can elect, on a change of control of the Company, where
a single party has over 50% of the issued share capital of the Company, to
convert some or all of the issued Loan Notes, including capitalised interest,
into ordinary shares at the lower of the 3p conversion price or the prevailing
market price.  Accrued but unpaid interest may be paid in cash at the time of
conversion or added to the loan principal and converted at the election of the
Noteholder.

 

Existing share authorities are sufficient to satisfy any potential conversion
of the maximum approved amount of £1.6 million plus any accrued interest.

 

The Company can elect to repay the Loan Notes in full or part at any time by
giving the noteholders one months' notice.

 

How to subscribe to the Loan Notes

The Loan Notes will be issued by the Company directly to each subscriber.

 

The Loan Note Investor Presentation and Term Sheet can be downloaded from the
Company's website at https://prospex.energy/investors/corporate-documents
(https://prospex.energy/investors/corporate-documents) .

 

To subscribe to the Loan Notes please contact the Company's brokers VSA
Capital or Hannam & Partners by email:-

VSA Capital                         email mail@vsacapital.com

Hannam & Partners        email info@hannam.partners

 

Loan Note Subscriptions to date

£565,000 Loan Notes have been issued to 8 individual subscribers, including
all of the current Directors and one member of the executive management team
who is also a Person Discharging Managerial Responsibility ("PDMR"):

 

Director*/PDMR†                                   Amount

Bill Smith*
       £25,000

Alasdair Buchanan*                                 £25,000

Mark Routh*
 £10,000

Andrew Hay*
£20,000

Richard Jameson†
 £65,000

Total
           £145,000

 

Related Party Transaction

The participation in the Loan Notes by the Directors, and HEYCO Energy Group,
Inc., constitutes a related party transaction under the AIM Rules.  Due to
the participation by all of the directors in the Loan Notes, there is not a
director, or directors, independent of the issue of the Loan Notes to provide
the necessary AIM Rule 13 related party transaction opinion.  Accordingly,
Strand Hanson Limited, the Company's Nominated Adviser, confirms it is
satisfied that the terms of the participation by the Directors and HEYCO
Energy Group, Inc., in the Loan Notes is fair and reasonable insofar as the
Company's shareholders are concerned.

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR") and is disclosed
in accordance with the Company's obligations under Article 17 of MAR.

 

* * ENDS * *

 

For further information visit www.prospex.energy (http://www.prospex.energy)
or contact the following:

 

 Mark Routh                        Prospex Energy PLC            Tel: +44 (Tel:+44) (0) 20 7236 1177
 Ritchie Balmer                    Strand Hanson Limited         Tel: +44 (0) 20 7409 3494

Rory Murphy
 Andrew Monk (Corporate Broking)   VSA Capital Limited           Tel: +44 (0) 7469 152 119

Andrew Raca (Corporate Finance)
 Neil Passmore                     Hannam & Partners             Tel: +44 (0) 20 7907 8500

 Leif Powis
 Ana Ribeiro / Charlotte Page      St Brides Partners Limited    Tel: +44 (0) 20 7236 1177

 

Notes

Prospex Energy PLC is an AIM quoted investment company focussed on high impact
onshore and shallow offshore European opportunities with short timelines to
production.  The Company's strategy is to acquire undervalued projects with
multiple, tangible value trigger points that can be realised within 12 months
of acquisition and then applying low-cost re-evaluation techniques to identify
and de-risk prospects.  The Company will rapidly scale up gas production in
the short term to generate internal revenues that can then be deployed to
develop the asset base and increase production further.

 

About Viura:

The Viura acquisition significantly increased Prospex's estimated reserves by
6.5 Bcf (0.18 Bcm) net to Prospex.  The Operator's best estimate of
recoverable gross remaining reserves at the Viura field is 90 Bcf (2.5 Bcm)
and is expected to increase upon further evaluation of the newly drilled
horizons.  Once the newly reprocessed 3D seismic is reinterpreted it is the
Operator's intention to update the reservoir model, gas in place and obtain an
independently verified report on the reserves for the Viura field.

 

About Tarba:

Tarba normally generates electricity at its El Romeral power plant from its
own natural gas production from the concessions, which in July 2024 were
granted a ten-year extension by the central Spanish Ministry to July 2034.
 The plant is currently not producing electricity whilst a new transformer is
being sourced.  The five wells currently in the final stages of the
permitting process are planned to target the five optimum structures on the El
Romeral concessions, which will produce biogenic gas from shallow subsurface
horizons.  The depth of the wells average about 700 metres and will each take
no longer than 3 to 4 weeks to drill once a suitable drilling rig has been
mobilised after the well permits are secured.

 

El Romeral Gas Reserves and Resources

An independent Competent Person's Report including the gas Reserves as well as
the Contingent and Prospective gas Resources of the El Romeral Licence areas,
was prepared by Netherland Sewell & Associates Inc. on 9 October
2019.( 2 )  In addition to the 2P reserves of 8.5 MMscm (0.3 Bcf) it
attributes a total of 142 MMscm (5.0 Bcf) of 2C resources and 2,541 MMscm
(89.7 Bcf) Best Estimate Prospective resources to the El Romeral Licence
Concessions.

 

Prospex through its ownership of Tarba now owns 100% of the El Romeral
Concessions.

 

About Selva:

The Selva Malvezzi Production Concession is in the Po Valley region of
northern Italy.  The concession contains the Selva gas-field as well as
exciting exploration and development opportunities.  The Podere Maiar-1 well
at Selva was completed in December 2017 and successfully found a commercial
gas accumulation up-dip of the previous wells on the Selva field.  The
Company has a 37% working interest in the Production Concession held via
Prospex's two wholly owned subsidiaries, PXOG Marshall Ltd (17% of the
Licence) and UOG Italia Srl (20% of the Licence).

 

The Selva Malvezzi Production Concession holds independently verified 2P gross
proven reserves of 13.4 Bcf (5.0 Bcf net to Prospex at 37% WI) in Selva, gross
Contingent 2C Resources of 14.1 Bcf (5.2 Bcf net) and a further 88.2 Bcf of
gross Best Estimate Prospective Resources (un-risked) (32.6 Bcf net).( 1 )

An independent Competent Person's Report of the Podere Gallina Licence which
was converted into the Selva Malvezzi Production Concession at first gas in
July 2023, was prepared by CGG Services (UK) Limited in July 2022 on behalf of
the joint venture.( 1 )  It attributed a total of 379 MMscm (13.4 Bcf) gross
2P reserves for the Selva redevelopment project.

 

References:

( 1 ) Source: "Competent Person's Report Podere Gallina Licence, Italy"
prepared by CGG Services (UK) Limited in July 2022 : Selva-CGG_CPR-July-2022
(https://eur03.safelinks.protection.outlook.com/?url=https%3A%2F%2Fbit.ly%2F44VF02A&data=05%7C01%7Cana%40stbridespartners.co.uk%7Ce27db61066ba4edeed3f08db94f7d5a5%7C48b7268319d344289c4b73cf144d89ed%7C1%7C0%7C638267564391602202%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=glSh9awfUUAreAZfLeRjoo%2FtRCIsIW2TSML5zO%2FUkew%3D&reserved=0)

( 2 ) Source: "Competent Person's Report Netherland Sewell & Associates
Inc. 9 October 2019.

El-Romeral-NSAI-CPR-2019
(https://prospex.energy/wp-content/uploads/2025/11/NSAI_El-romeral-estimates-2019.pdf)

 

Glossary:

Bcf                          Billion standard cubic feet

MMscm               Million standard cubic metres

MMscfd               million standard cubic feet per day

MWh                     Mega Watt hour

scm                        Standard cubic metres

scm/d                   Standard cubic metres per day

TTF                         The 'Title Transfer Facility' - a
virtual trading point for natural gas in the Netherlands.

 

 

Qualified Person Signoff

In accordance with the AIM notice for Mining and Oil and Gas Companies, the
Company discloses that Mark Routh, the CEO and a director of Prospex Energy
plc has reviewed the technical information contained herein.  Mark Routh has
an MSc in Petroleum Engineering and has been a member of the Society of
Petroleum Engineers since 1985.  He has over 40 years operating experience in
the upstream oil and gas industry.  Mark Routh consents to the inclusion of
the information in the form and context in which it appears.

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