TIDMPXOG
RNS Number : 3580B
Prospex Oil and Gas PLC
30 January 2020
Prospex Oil and Gas Plc / Index: AIM / Epic: PXOG / Sector: Oil
and Gas
Prospex Oil and Gas Plc ('Prospex' or the 'Company')
Placing to Raise GBP720,000 & Director Dealing
Prospex Oil and Gas Plc, the AIM quoted investment company, is
pleased to announce that it has raised GBP720,000 gross via an
oversubscribed placing of 600,000,000 new ordinary shares of
GBP0.001 each in the Company ("Ordinary Shares") (the "Placing
Shares") at a price of 0.12 pence per Placing Share (the "Placing
Price") (the "Placing"). The net proceeds of the Placing will
primarily be used to fund the Company's acquisition of a 49.9%
indirect stake in El Romeral, an integrated gas production and
power station operation located in the Guadalquivir basin in
southern Spain ('El Romeral' or 'Project') (please refer to the
Company's announcement of 17 December 2019 for further
information). The Placing was undertaken with new and existing
investors as well as certain Directors of the Company who are
acquiring Placing Shares with an aggregate value of GBP140,000
based on the Placing Price.
Use of Proceeds
As previously announced, El Romeral is being acquired by Tarba
Energia S.L ("Tarba") which is jointly owned by Prospex and Warrego
Energy Limited ("Warrego"). Warrego funded the initial
consideration of EUR750,000 for a 100% interest in El Romeral.
Tarba has advised the Company that this has been paid to the vendor
and the vendor has initiated the transfer process.
Following the Placing, Prospex will elect to participate with a
49.9% interest in the Project and will therefore refund to Warrego
the corresponding proportion of the initial consideration
(EUR374,250). Following this, Warrego will indirectly own the
balance of the Project, being 50.1%.
El Romeral includes three production licences on which three
wells supply gas to a Project-owned 8.1 MW power station. The
acquisition of a 49.9% interest in El Romeral will therefore lead
to a step-up in Prospex's production profile to five producing gas
wells, which have the potential to generate over 9,000,000 scm net
in 2021. In addition to the three producing wells at El Romeral,
Prospex has a 50% interest in the Bainet-1 well on the Suceava
Concession in Romania and a 17% economic interest in the Podere
Maiar-1 well on the Podere Gallina Exploration Permit in Italy
which is expected to commence production in 2020 at rates up to
150,000 scmpd (5,300 mscfd), subject to regulatory approvals and
installation of production equipment.
El Romeral offers significant development upside to increase gas
production and, in turn, electricity generation at the Project's
plant, which was constructed in 2001-2002 at a cost of c. EUR10
million and currently operates at c. 22% capacity. Gross contingent
and prospective gas resources of 5 Bcf and 90 Bcf have been
assigned to two development locations and 11 very-low risk
prospects at El Romeral respectively. A planning and permitting
process for a three well campaign targeting these prospects is
expected to commence in Q1-Q2 2020.
The proceeds of the Placing will also go towards funding the
2020 work programme planned for Prospex's 15%-owned 830 Bcf
Tesorillo gas project in Spain as well as general working capital
purposes.
Directors' Dealing
As part of the Placing, Edward Dawson, CEO, Bill Smith,
Non-Executive Chairman, and James Smith, Non-Executive Director,
have agreed to acquire the following number of Placing Shares:
No. of Placing Resultant no. of % of Enlarged Issued
Shares acquired Ordinary Shares Share Capital (as
enlarged by the
Placing)
Edward Dawson 50,000,000 55,272,919 2.50%
Bill Smith 33,333,333 42,472,677 1.92%
James Smith 33,333,333 43,333,333 1.96%
Edward Dawson, Bill Smith and James Smith, as Directors of the
Company, are classified as related parties under the AIM Rules for
Companies and their participation in the Placing therefore
constitutes a related party transaction.
Accordingly, Richard Mays, being the only Director of the
Company not participating in the Placing, having consulted with
Strand Hanson, the Company's nominated adviser, considers that the
participation of Edward Dawson, Bill Smith and James Smith in the
Placing is fair and reasonable insofar as the Company's
shareholders are concerned.
Prospex Non-executive Chairman, Bill Smith, said, "Securing
these funds at close to market prices from new and existing
shareholders and certain members of the Board represents an
endorsement of the low risk, low cost opportunity that El Romeral
offers to build material production and revenues. Thanks to this
Placing, Prospex is able to elect to acquire a 49.9% interest in
Romeral. Following this, and once the Podere Maiar-1 well in Italy
comes online later this year as we anticipate, our portfolio of
producing wells will stand at five, which, when combined, will have
the potential to generate over 9,000,000 scm net in 2021. At this
rate and at current gas prices, our annual revenues alone will
exceed our current market capitalisation.
"Prospex is not just a value play, however. Significant upside
has been identified across our portfolio including at the Tesorillo
Project in Spain, which has the potential to hold up to 830 Bcf of
gross prospective gas resources, and at Podere Gallina in Italy
where, in addition to the 13.3bcf gas reserves of the Selva field,
a CPR estimates the licence area holds 14.1 bcf gross contingent
resources and 91.5 bcf gross prospective resources (Best Estimate).
With work programmes underway or planned to de-risk these
company-making resources, the growth story behind Prospex remains
very much intact."
Admission to Trading on AIM and Total Voting Rights
The Placing Shares will rank pari passu with the existing
Ordinary Shares. Application will be made for the Placing Shares to
be admitted to trading on AIM ("Admission") and Admission is
expected to occur on or around 11 February 2020.
Following Admission, the Company will have in issue a total of
2,213,593,136 Ordinary Shares. The Company has no shares in
treasury, therefore the figure of 2,213,593,136 should 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 to their interest in, the share capital of the Company
under the FCA's Disclosure Guidance and Transparency Rules.
Following the Placing, Mr Simon Chantler will hold 239,666,667
Ordinary Shares, representing 10.83 per cent. of the Company's
issued share capital as enlarged by the Placing.
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 ("MAR").
* *S * *
For further information visit www.prospexoilandgas.com or
contact the following:
Edward Dawson Prospex Oil and Gas Plc Tel: +44 (0) 20 3948
1619
Rory Murphy Strand Hanson Limited Tel: +44 (0) 20 7409
Ritchie Balmer 3494
Jack Botros
Colin Rowbury Novum Securities Limited Tel: +44 (0) 20 7399
Jon Belliss 9427
Duncan Vasey Peterhouse Capita Limited Tel: +44 (0) 20 7220
Lucy Williams 9797
Frank Buhagiar St Brides Partners Ltd Tel: +44 (0) 20 7236
Priit Piip 1177
Notes
Prospex Oil and Gas Plc is an AIM quoted investment company
focused on high impact onshore and shallow offshore European
opportunities with short timelines to production. The Company's
management acquires 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.
PDMR Notifications
1. Details of the person discharging managerial responsibilities
/ person closely associated
a) Name 1. Bill Smith
2. James Smith
3. Edward Dawson
-------------------------------- -------------------------------------------
2. Reason for the Notification
-----------------------------------------------------------------------------
a) Position/status 1. Non-Executive Chairman
2. Non-Executive Director
3. CEO and Managing Director
-------------------------------- -------------------------------------------
b) Initial notification/amendment Initial notification
-------------------------------- -------------------------------------------
3. Details of the issuer, emission allowance market participant,
auction platform, auctioneer or auction monitor
-----------------------------------------------------------------------------
a) Name Prospex Oil and Gas plc
-------------------------------- -------------------------------------------
b) LEI 213800NY9RH8O1B72D27
-------------------------------- -------------------------------------------
4. Details of the transaction(s): section to be repeated for
(i) each type of instrument; (ii) each type of transaction;
(iii) each date; and (iv)each place where transactions have
been conducted
-----------------------------------------------------------------------------
a) Description of the Financial Ordinary Shares of 0.1p
instrument, type of instrument
-------------------------------- -------------------------------------------
Identification code GB00BW4NPC58
-------------------------------- -------------------------------------------
b) Nature of the Transaction Purchase of ordinary shares
-------------------------------- -------------------------------------------
c) Price(s) and volume(s) Price(s) Volume(s)
1. GBP0.0012 1. 33,333,333
2. GBP0.0012 2. 33,333,333
3. GBP0.0012 3. 50,000,000
--------------------
-------------------------------- -------------------------------------------
d) Aggregated information Aggregate volume: 116,666,666
Aggregated volume / price Aggregated price: GBP0.0012
-------------------------------- -------------------------------------------
e) Date of the transaction 30 January 2020
-------------------------------- -------------------------------------------
f) Place of the transaction London Stock Exchange, AIM
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This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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