REG - UK Oil & Gas PLC - Placing & Retail Offer to fund new H2 storage site

UK Oil & GasAnnouncement

19/11/2024 07:00

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RNS Number : 7021M  UK Oil & Gas PLC  19 November 2024

UK Oil & Gas PLC

("UKOG" or the "Company")

 

Placing and Retail Offer to fund new H2 storage site

 

UK Oil & Gas PLC (London AIM: UKOG) is pleased to announce that it has
successfully raised gross proceeds of £0.5 million by means of a placing (the
"Placing") of new Ordinary Shares (the "Placing Shares") at a price of 0.025
pence per share (the "Issue Price"). The Issue Price represents a discount of
approximately 26 per cent to the Closing Price of 0.034 pence per Ordinary
Share on 18(th) November 2024, being the latest practicable business day prior
to the publication of this Announcement.

In addition to the Placing, as the Company greatly values its existing retail
shareholder base, the Company also intends to offer its existing retail
shareholders a "Retail Offer" of new Ordinary Shares at the same Issue Price
as the Placing (the "Retail Offer Shares" and together with the Placing Shares
the ("Fundraising Shares").

The Company will release a separate announcement regarding the Retail Offer
and its terms. For the avoidance of doubt, the Placing is separate from and
does not form part of the Retail Offer.

Use of Proceeds:

 

The Placing's proceeds will firstly be employed to enable the acquisition of
the Company's first salt cavern hydrogen storage site in the East Yorkshire
salt basin, the UK's most extensive and thickest salt deposit and a key
nationally strategic area for future hydrogen and existing natural gas
storage. The acquisition of this site, along with the Company's Dorset sites,
would provide the  Company with one of the largest single portfolios of
potential salt-cavern storage sites in the UK.

 

The Company has a unique window of opportunity to acquire long term purchase
and leasehold rights to the property, which lies firmly in the Government's
East Coast Track #1 Hydrogen cluster and within the UK's largest CO2 emissions
cluster, both prime targets within the Government's Clean Power 2030 strategy.
The property also lies adjacent to the first construction phase of the
proposed Project Union national hydrogen pipeline network, planned to connect
hydrogen producers, hydrogen-to-power stations, hydrogen storage and end users
in the East Coast Cluster and Teesside.

 

The envisaged surface development area, which lies in farmland with direct
access to the North Sea for the brine necessary to dissolve the caverns,
benefits from strong planning precedence in the area for similar material
infrastructure projects, greatly increasing the likely probability of securing
the necessary Development Consent Order ("DCO"). A future development would be
of a similar material storage capacity to the Company's primary Dorset
project.

 

The proceeds will also permit the Company to acquire all or some of the
relevant Intellectual Property relating to prior consented infrastructure
developments in the area, as well as helping materially advance the Company's
overall hydrogen storage portfolio towards applications for DCO and Government
Revenue Support in the First Hydrogen Storage Allocation Round, now expected
to launch in Q1 2025.

 

Additionally, the Company continues in advanced discussions with an energy
infrastructure investor regarding participation in UKEn's current Dorset and
new Yorkshire projects. We look forward to providing further updates in due
course.

Placing Summary

 

·    The Placing raised £500,000 (before expenses) through the issue
of 2,000,000,000 Placing Shares at the Issue Price.

·    The net proceeds of the Placing will be utilised as described above.

·    Participants in the Placing have subscribed on the basis of the
customary terms and conditions of the Placing.

 

Stephen Sanderson UKOG's Chief Executive commented:

"The company has decided to call on additional capital to take advantage of
the unique and timely opportunity to  further its acquisition of a new
hydrogen storage development site in East Yorkshire. The property is located
firmly within the government's E. Coast Track #1 hydrogen cluster and adjacent
to the first phase of connection to Project Union, the planned national
hydrogen pipeline network. Together with our primary Dorset project, the
addition of this site will help grow the Company's hydrogen storage portfolio
to one of the largest in the UK and position us to take advantage of the
government's planned Hydrogen Storage Allocation Round in 2025."

 

Placing Information

 

The Placing has not been underwritten by CMC and is conditional inter
alia on the placing agreement dated 18 November 2024 between the Company and
CMC (the "Placing Agreement") not having been terminated or breached and the
Admission of the Placing Shares to trading.  CMC Markets UK Plc ("CMC"),
trading as CapX, acted as the Company's sole placing agent in respect of the
Placing.

The Placing Shares will be issued, credited as fully paid, and will rank pari
passu with the existing Ordinary Shares in issue in the capital of the
Company, including the right to receive all dividends and other distributions
(if any) declared, made or paid on or in respect of such shares after the date
of their issue.

Admission to trading

 

Application will be made to AIM for Admission, which is expected to become
effective and dealings in the Placing Shares to commence at, 8.00 a.m. on or
around 25(th) November 2024.

Following Admission, the total voting rights in the Company will therefore be
13,140,761,833 and Shareholders will be able to use this figure as the
denominator by which they are required to notify their interest in, or change
to their interest in, the Company under the Disclosure Guidance and
Transparency Rules.

 

 

For further information, please contact:

UK Oil & Gas Plc

Stephen Sanderson / Matt Cartwright
 
                                       Tel:
01483 941493

 

Zeus (Nominated Adviser and
Broker)

James Joyce / James Bavister / Andrew de Andrade
                              Tel: 020 3829 5000

 

CMC Markets (Joint Broker)

Douglas
Crippen
Tel: 0203 003 8632

 

Communications

Brian Alexander
 
             Tel: 01483 941493

 

 

The information contained within this announcement is deemed by the Company to
constitute inside information under the Market Abuse Regulation (EU) No.
596/2014, as it forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018. Upon publication of this announcement, this information
is now considered to be in the public domain.

 

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