TIDMCDL
RNS Number : 3127N
Cloudbreak Discovery PLC
31 May 2022
31 May 2022
Cloudbreak Discovery Plc
("Cloudbreak" or the "Company")
Cloudbreak Acquires a 3.25% Overriding Royalty Interest on the
Masten Unit Energy Project
Cloudbreak Discovery PLC (LSE: CDL) is pleased to announce that
it has entered into an agreement with G2 Energy Corp. (CSE: GTOO)
("G2") whereby Cloudbreak will provide a portion of the acquisition
financing for the Masten Unit Energy Project (the "Project"),
located in Cochran County Texas, to G2 in exchange for a 3.25%
Overriding Royalty Interest ("ORI") in the Project, in addition to
other considerations.
G2 has developed a comprehensive, economic programme of well
recompletion and drilling to rapidly grow both oil and natural gas
production from the Project. The programme consists of waterfloods
and workovers of existing wells as well as new offset wellbores and
lateral drilling which G2 plans to initiate on financial close.
Key Terms of the Transaction
-- Cloudbreak will provide G2 with a USD $2 million debenture on
a two-year term in exchange for a 3.25% ORI in the Project, in
addition to other considerations
-- G2 will pay 12% per annum interest to Cloudbreak, calculated
and paid quarterly in cash or shares at the discretion of
Cloudbreak on the USD $2 million debenture
-- G2 will grant Cloudbreak;
o 6,500,000 Warrants with a $0.30 strike price with a two-year
term from financial close. The Warrants are subject to an
acceleration clause;
o Second position lien on the Project;
o An area of interest providing Cloudbreak with a 1% ORI on any
project acquired within a two-mile radius of the Masten Unit lease
boundary; and
o An area of influence giving Cloudbreak the right of first
refusal to finance additional acquisitions within five miles of the
Project boundary and apply its existing 3.25% ORI to that project
in addition to terms settled on as part of an acquisition.
Kyler Hardy, President and CEO of Cloudbreak , commented, "This
first royalty acquisition highlights the beginning of a great
working relationship between Cloudbreak and G2. We are excited to
be working with G2 and look forward to additional regional
acquisitions, showcasing how our project generator model can be
transitioned to the energy royalty sector.
"Through this and similar transactions in the future, we see an
opportunity to create significant shareholder value by growing
Cloudbreak's cash-flow though structured deals and portfolio
royalty acquisitions in the natural resources sector."
About the Masten Unit Energy Project
The Masten Unit Energy Project is a 3,194 net acre producing
unit, 100% held by production, located in the giant, billion-barrel
Levelland Field in Cochran County, Texas. The Levelland field is
situated in the Permian Basin and the producing formation is the
San Andres, with an average depth in the area of 1,500 metres.
G2 has a 100% Working Interest and 81% Net Revenue Interest in
the Project. Current production is 80 barrels of oil per day and
130 thousand cubic feet of gas per day from 18 active wells. All-in
operating costs are USD $15.49 per barrel of oil equivalent,
including production tax. The field has Proven reserves of 542
thousand barrels of oil equivalent ("MBOE") with a PV10 of USD $6.2
million and Probable Reserves of 700 MBOE with a PV10 of USD $6.4
million (Reserve commodity price assumptions: NYMEX and HH Strip
March 2022).
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the Company's obligations under Article 17 of MAR.
Qualified Person
Mr. Rory Kutluoglu P. Geo., Chief Operation Officer of the
Company, is the Qualified Person ("QP") under NI 43-101 for the
technical information in this news release, has verified the data
disclosed and approves the technical contents contained in this
news release.
-ENDS-
For additional information please contact:
Cloudbreak Discovery Tel: +1 604 428 9480
PLC
Kyler Hardy, CEO khardy@cloudbreakdiscovery.com
Novum Securities Tel: +44 7399 9400
(Financial Adviser)
David Coffman / Lucy
Bowden
Shard Capital Partners Tel: +44 207 186 9900
(Broker)
Damon Heath / Isabella
Pierre
BlytheRay Tel: +44 207 138 3204 Cloudbreak@blytheray.com
(Financial PR/IR-London)
Tim Blythe
Megan Ray
Stellium Services Tel: +44(0)207 129 Cloudbreak@StelliumServices.com
(Investor Relations) 1205
www.StelliumServices.com Andrew Wilson
Claire Bowden
About Cloudbreak Discovery PLC
Cloudbreak Discovery PLC, is a leading natural resource project
generator, working across a wide array of mineral assets that are
being developed and managed by an experienced team with a proven
track record. Value accretion within the projects being developed
by Cloudbreak's generative model enables a multi-asset approach to
investing and exploration. Diversification within the mining sector
and amongst resource classes is key to withstanding the cycles of
natural resource investing.
About G2 Energy Corp.
G2 Energy Corp is a Canadian Securities Exchange listed company
focused on acquiring and developing overlooked, low risk, high
return opportunities in the oil and gas sector. G2 is seeking to
acquire a portfolio of risk- managed production and development
opportunities onshore, U.S.A. In the near term, G2 is pursuing
production acquisition opportunities with top tier operating
netbacks and infrastructure facilities to fast track future
production growth.
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END
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May 31, 2022 02:01 ET (06:01 GMT)
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