REG - Reabold Resources - Further Investment in LNEnergy

Reabold ResourcesAnnouncement

12/06/2023 07:15

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RNS Number : 3267C  Reabold Resources PLC  12 June 2023

12 June 2023

Reabold Resources plc

("Reabold" or the "Company")

Further Investment in LNEnergy

Reabold Resources plc, the oil & gas investing company with a diversified
portfolio of exploration, appraisal and development projects, is pleased to
announce the exercise of certain of its options to increase its interest in
LNEnergy Limited ("LNEnergy") by a further 13.2%, for an aggregate cash
consideration of £500,000, to be satisfied through existing cash resources
(the First Option), and £1,500,000 through the issue of 810,810,811 new
ordinary shares of 0.1p each in the capital of the Company ("Ordinary Shares")
at a price of 0.185 pence per Ordinary Share (the "Consideration Shares") to
certain LNEnergy shareholders (the Shareholder Option).

These exercises follow the Company's announcement of 9 May 2023 entitled
"Investment in LNEnergy" announcing Reabold's initial subscription to acquire
a 3.1% interest in LNEnergy for a cash consideration of £250,000. As a
result, Reabold will own a 16.2% equity interest in LNEnergy.

Furthermore, Reabold retains the Second Option, expiring 30 November 2023, to
acquire, at its sole discretion, a further 10.5% in new shares in LNEnergy for
an aggregate cash consideration of £1,800,000, which would be satisfied
through either cash or shares, at the option of LNEnergy. If the Second Option
is exercised, it would result in Reabold holding a 25.0% interest in the
enlarged share capital of LNEnergy for a total cash and equity consideration
of £4,050,000.

Key points

·    LNEnergy's primary asset is an exclusive option over a 90% interest
in the onshore Colle Santo gas field in Abruzzo, Italy, discovered in 1966:

o  Highly material gas resource, particularly in the context of onshore
Europe; 65Bcf of 2P reserves 1  (#_ftn1)

o  Development ready, subject to approvals and permits

o  Two production wells already drilled, no additional drilling required;
first gas targeted for early 2025

 

·    Since the initial agreement on 9 May 2023, Reabold has undertaken
significant due diligence work, resulting in increased confidence in the
likelihood of permits being granted for field development:

o  Revised small-scale LNG development has smaller land footprint and strong
environmental credentials

o  Two-year, long-term production test currently under review

o  Full production concession approval expected 2024 to allow 20+ year
production

 

·    Reabold's investment supports the development engineering and
approvals process prior to project financing to bring the project to first
gas, with attractive economic returns

o  LNEnergy believes that the field has potential to generate estimated
€11-12m of post-tax free cash flow per annum

Stephen Williams, Co-CEO of Reabold, commented:

"The potential in the Colle Santo gas field presents an exciting opportunity
for Reabold to pursue its investment strategy to fund low risk, near-term
projects with a clear path to generating cash flow. Our detailed work and
analysis in recent weeks have increased our confidence that development of the
field will ultimately be approved. Reabold has acquired a significant interest
in the project through its investment in LNEnergy, and we look forward to
updating our shareholders with progress on the project throughout the year.

 

Admission and total voting rights

Application has been made for admission of the 810,810,811 Consideration
Shares to trading on AIM ("Admission"), and it is expected that Admission will
occur at 8.00 a.m. on or around 13 June 2023. The Consideration Shares will
rank pari passu with the existing Ordinary Shares.

Following Admission, based on the Company's last Transaction in Own Shares
announcement dated 12 June 2023 and subject to any further transactions in own
shares pursuant to the ongoing share buyback in the interim period, the total
issued share capital of the Company will consist of 9,988,198,720 Ordinary
Shares. The Company holds 48,812,617 Ordinary Shares in treasury. Therefore,
on Admission, the total number of voting rights in the Company will be
9,939,386,103 and this is the figure may be used by shareholders as the
denominator for the calculations by which they will determine if they are
required to notify their interest in, or a change in their interest in, the
share capital of the Company under the FCA's Disclosure Guidance and
Transparency Rules.

Unless otherwise defined, capitalised terms used in this announcement have the
same meanings as ascribed to them in the Company's announcement of 9 May 2023
entitled "Investment in LNEnergy".

This announcement contains inside information for the purposes of the UK
version of the market abuse regulation (EU No. 596/2014) as it forms part of
United Kingdom domestic law by virtue of the European Union (Withdrawal) Act
2018, as amended.

For further information, contact:

 

 Reabold Resources plc                                      c/o Camarco

 Sachin Oza                                                 +44 (0) 20 3757 4980

 Stephen Williams

 Strand Hanson Limited - Nominated & Financial Adviser      +44 (0) 20 7409 3494

 James Spinney

 James Dance

 Rob Patrick

 Stifel Nicolaus Europe Limited - Joint Broker              +44 (0) 20 7710 7600

 Callum Stewart

 Simon Mensley

 Ashton Clanfield

 finnCap Ltd - Joint Broker                                 +44 (0) 20 7220 0500

 Christopher Raggett

 Barney Hayward

 Camarco                                                    +44 (0) 20 3757 4980

 Billy Clegg

 Rebecca Waterworth

 

Notes to Editors

 

Reabold Resources plc has a diversified portfolio of exploration, appraisal
and development oil & gas projects. Reabold's strategy is to invest in
low-risk, near-term projects which it considers to have significant valuation
uplift potential, with a clear monetisation plan, where receipt of such
proceeds will be returned to shareholders and re-invested into further growth
projects. This strategy is illustrated by the recent sale of the undeveloped
Victory gas field to Shell, the proceeds of which are being returned to
shareholders and re-invested.

 

 1  (#_ftnref1) RPS estimate, September 2022

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