Polo Resources (LSE:POL)
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RNS Number : 0293P
Polo Resources Limited
07 October 2019
This announcement contains inside information as defined in Article 7 of the EU Market Abuse Regulation No 596/2014 and has been announced in accordance with the Company's obligations under Article 17 of that Regulation.
7 October 2019
Polo Resources Limited
("Polo" or the "Company")
HIBISCUS PETROLEUM - INVESTMENT UPDATE
Hibiscus Petroleum Group Executes Conditional Sale and Purchase Agreement to Acquire Crown Discovery in the North Sea
Polo Resources Limited (AIM: POL), the multi-sector investment company with interests in oil, gold, coal, copper, phosphate, lithium, iron and vanadium, notes that its 8.75% investee company Hibiscus Petroleum Berhad ("Hibiscus") has announced that its indirect wholly--owned subsidiary, Anasuria Hibiscus UK Limited ("AHUK"), has entered into a conditional SPA to acquire License P2366, from United Oil & Gas PLC ("United") and Swift Exploration Limited ("Swift") (collectively referred to as "Sellers") for a total cash consideration of up to USD5 million.
The Blocks are located offshore in the United Kingdom sector of the North Sea, approximately 250km northeast of Aberdeen. The Blocks include the Crown Discovery which consists of 2C contingent resources that range between 4 to 8 million barrels of oil, subject to an independent 3rd party expert assessment. The Blocks are located 12km south--east of Marigold field, which together with the Sunflower field, was acquired by AHUK in October 2018.
United and Swift were awarded License P2366 as part of the United Kingdom's Oil and Gas Authority's
("OGA") 30th Licencing Round, in August 2018, and they each hold 95% and 5% participating interest respectively.
AHUK holds 50% operated interest in Licence P198 Blocks 15/13a and 15/13b containing the Marigold and Sunflower oilfields respectively, in addition to 50% joint--operating interests in the P013 licence consisting of the Teal, Teal South and Guillemot A fields, as well as 19.3% non--operating interest in the P185 licence consisting of the Cook field. The Teal, Teal South, Guillemot A and Cook fields which produce oil and gas to the Anasuria Floating Production Storage and Offloading facility are collectively known as the Anasuria Cluster. The Anasuria Cluster is located offshore in the United Kingdom sector of North Sea.
Pursuant to further negotiations with the Sellers post execution of the earlier conditional non--binding term sheet, the payment terms of the proposed acquisition of License P2366 would commence with a non--refundable payment of USD0.1 million to the Sellers (unless the default is not due to AHUK) and a further USD0.9 million upon completion of the SPA. Subject to further milestones being achieved post SPA completion, an additional sum of USD3 million will be paid within 7 business days of the actual date of approval of the Marigold Field Development Plan ("FDP") which includes the development of the Crown discovery as part of the overall Marigold development ("FDP Approval"), by the relevant United Kingdom regulatory authority, which is expected to be received by the end of 2020. However, if FDP Approval is not achieved, or if the Marigold FDP submitted does not include the development of the Crown discovery, AHUK may, at its discretion, proceed with the USD3 million payment or transfer License P2366 back to the Sellers at nominal consideration without any further payment obligation. In addition, up to USD1 million will be paid through an overriding royalty scheme once the Crown discovery has commenced production.
Given its proximity to Marigold, the contemplated development of Crown is based on a single well subsea tieback to the Marigold field.
The proposed consideration was arrived at on a similar basis to the consideration paid for the Marigold and Sunflower fields as they are seen as being accretive to the existing Marigold and Sunflower development.
The proposed acquisition of License P2366 is subject to the receipt of OGA's approval for the assignment of the license to AHUK and the appointment of AHUK as operator. If the conditions have not been fulfilled or waived by the parties by 31 December 2019 (or such later date no later than 31 March 2020 as the parties may mutually agree), the proposed acquisition would be terminated according to the terms of the SPA.
About United Oil & Gas PLC
United Oil & Gas PLC is an independent oil & gas start--up established in 2015. It is listed on the AIM market of the London Stock Exchange.
About Swift Exploration Limited
Swift Exploration Limited is a private oil and gas exploration company formed in 2003. It focuses on developing exploration and production opportunities in the North Sea and the UK onshore for farmout/sale.
The full details of this announcement can be found at http://www.hibiscuspetroleum.com/.
For further information, please contact:
Polo Resources Limited
- Kudzayi Denenga, Investor Relations +27 (0) 787 312 919
Allenby Capital Limited (Nominated
adviser & broker)
- John Depasquale +44 (0)20 3328 5657
About the Company
Polo Resources Limited is a multi-sector investment company focused on investing in undervalued companies and projects with strong fundamentals and attractive growth prospects. For complete details on Polo, please refer to: www.poloresources.com.
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(END) Dow Jones Newswires
October 07, 2019 09:51 ET (13:51 GMT)