REG - United Oil & Gas PLC - APA Signed - Conditional Sale of Maria Discovery

United Oil & GasAnnouncement

17/01/2023 07:00

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RNS Number : 9036M  United Oil & Gas PLC  17 January 2023

United Oil & Gas PLC / Index: AIM / Epic: UOG / Sector: Oil & Gas

 

17 January 2023

United Oil and Gas plc

("United" or "the Company")

 

APA Signed - Conditional Sale of Maria Discovery

 

United Oil & Gas Plc (AIM: "UOG"), the full-cycle oil and gas company
with a portfolio of production, development, exploration and appraisal
assets is pleased to announce that it has entered into a binding Asset
Purchase Agreement ("APA") with Quattro Energy Limited ("Quattro") to sell
UK Central North Sea Licence P2519 containing the Maria discovery in Block
15/18e  ("the Licence") for a maximum consideration including contingent
bonus payments of up to £5.7 million (c.US$6.95 million) (the
"Transaction") as set out below.

 

Consideration comprises:

-       Initial cash payment of £2.45 million to United (c.US$3
million) at completion.

-       An additional £1.0 million to be paid to United upon approval
of an FDP (expected late 2023) for Block 15/18e.

-       Contingent bonus payments of up to £2.25 million upon reaching
gross production thresholds from the field of three, four and five million
barrels.

The completion of the APA is subject to a number of pre-conditions including
the North Sea Transition Authority ("NSTA") approval to the Licence
acquisition and Quattro having available an amount equal to the completion
payment of £2.45 million in cash. It is anticipated that completion of the
APA will be within 90 days from this announcement.

The divestment of the Licence reflects United's strategy to focus its new
ventures programme on opportunities in the Greater Mediterranean and North
Africa whilst remaining opportunistic for value accretive transactions outside
of these core areas.

Following completion of this transaction, the Company will consider options to
use a portion of the proceeds received to fund a limited share buyback
programme and therefore intends to seek the requisite shareholder approvals at
this year's Annual General Meeting to approve such a programme. The funds not
used on the buyback programme will further strengthen the Group's balance
sheet and support the growth strategy of the Group.

United was awarded Licence P2519, in the UK Oil and Gas Authority ("OGA" now
known as NSTA) 32(nd) Licencing Round in December 2020. Licence P2519
includes the Maria Discovery in Block 15/18e. United holds a 100% equity
interest and it has a carrying value of c.£0.7million (c.US$0.85 million) as
at 31 December 2022 (as per the Company's unaudited management accounts). The
Licence has an independently audited mid-case 2C gross contingent resource
estimate of 6.3 mmbbls and 23.3Bcf (10.2 mmboe). The Licence was formerly
subject to a disposal to Quattro which did not complete as per the
announcement on 3 March 2022.

Quattro is a UK company, incorporated in April 2021 with an
experienced North Sea focused management team, which as separately announced
today is entering into a binding agreement to be acquired by Jesmond Capital
Ltd ("Jesmond"), a Canadian company listed on the Toronto Stock Exchange (TSXV
JES.P).  In conjunction with the acquisition of Quattro by Jesmond and
listing of the enlarged entity on the TSXV, the parties will be conducting a
financing which is required by them to fund the completion of the acquisition
of the Licence.

United Chief Executive Officer, Brian Larkin commented:

"Active portfolio management, to realise value from our assets, has always
been a key part of United's strategy. We are pleased to be signing the APA
with Quattro, who have agreed a materially higher maximum consideration than
in 2021, reflecting the increased value of the Licence following the work
completed by our technical team over the last 12 months. Whilst the Company
explored options whereby we participated directly in the future development of
Maria, we ultimately believe that monetising the Maria discovery at this time
provides us with a significant return from our investment and gives us
additional capital to continue to execute our ambition to grow the business in
our core focus areas in the Greater Mediterranean and North Africa regions. We
wish Quattro all the very best for their new venture."

END

This announcement contains inside information for the purposes of Article 7 of
Regulation 2014/596/EU which is part of domestic UK law pursuant to the
Market Abuse (Amendment) (EU Exit) regulations (SI 2019/310).

 

 United Oil & Gas Plc (Company)

 Brian Larkin, CEO                                brian.larkin@uogplc.com (mailto:brian.larkin@uogplc.com)
 Sharan Dhami, Head of IR & ESG                   sharan.dhami@uogplc.com (mailto:sharan.dhami@uogplc.com)

 Beaumont Cornish Limited (Nominated Adviser)
 Roland Cornish | Felicity Geidt                  +44 (0) 20 7628 3396

 Tennyson Securities (Joint Broker)
 Peter Krens                                      +44 (0) 20 7186 9030

 Optiva Securities Limited (Joint Broker)
 Christian Dennis                                 +44 (0) 20 3137 1902

 Camarco (Financial PR)
 Georgia Edmonds | Emily Hall | Sam Morris        +44 (0) 20 3757 4983 | uog@camarco.co.uk (mailto:uog@camarco.co.uk)

Notes to Editors

United Oil & Gas is the full-cycle oil and gas company with a portfolio
of low-risk, cash generative production, development, appraisal and
exploration assets across Egypt, UK and a high impact exploration licence
in Jamaica.

The business is led by an experienced management team with a strong track
record of growing full cycle businesses, partnered with established industry
players and is well positioned to deliver future growth through portfolio
optimisation and targeted acquisitions.

United Oil & Gas is listed on the AIM market of the London Stock
Exchange. For further information on United Oil and Gas please
visit www.uogplc.com (http://www.uogplc.com) .

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