United Oil & Gas PLC Corporate Update (4436D)
March 03 2022 - 2:00AM
UK Regulatory
TIDMUOG
RNS Number : 4436D
United Oil & Gas PLC
03 March 2022
United Oil & Gas PLC / Index: AIM / Epic: UOG / Sector: Oil
& Gas
3 March 2022
United Oil and Gas plc
("United" or "the Company")
CORPORATE UPDATE
United Oil & Gas PLC (AIM: "UOG"), the growing oil and gas
company, issues the following corporate update.
Divestments
UK CNS
On 7 September 2021 United announced that it had entered into a
binding sale and purchase agreement (SPA) with Quattro Energy
Limited (Quattro) to sell its UK Central North Sea Licences; P2480
and P2519 for a consideration of up to GBP3.2m (c $4.4m).
Completion of the sale was conditional on receipt of approval from
the Oil and Gas Authority (OGA) and Quattro completing a
fundraising process. In December 2021 United announced that the
long stop date for satisfaction of the SPA conditions was extended
to 28 February 2022. Although OGA approval was received, Quattro
did not complete a fundraising process by this date. United has
decided to terminate the SPA with Quattro.
United was awarded Licence P2480, in the OGA's 31(st) Licencing
Round in August 2019 and Licence P2519 in the 32(nd) Licencing
Round, in December 2020. United holds a 100% equity interest in
each. Licence P2519 includes the existing Maria discovery drilled
by Shell in 1976. United estimated as part of its licence
application that Maria holds c. 6 MMboe mid-case recoverable
resources. The P2519 Licence also contains two Jurassic
discoveries, Brochel and Maol. Maol was drilled by Shell in 1987,
and on test flowed at over 2,000 boepd. Licence P2480 includes the
Zeta prospect. Both licences are close to existing infrastructure
and are located in a highly prospective area of the Central North
Sea, which includes the Marigold and Yeoman discoveries, where
there is significant development activity taking place and the
substantial Piper, MacCulloch and Claymore oil fields.
There are low-cost commitments on both licenses, and with rising
commodity prices and renewed activity in the nearby area United
believes they each contain attractive investment opportunities.
United look forward to progressing the commercialisation
opportunities and potential partnerships the assets offer.
Italy
United signed a conditional SPA with PXOG Marshall Limited, a
subsidiary of Prospex Energy PLC (Prospex) for the sale of 100% of
the share capital of UOG Italia Srl for a consideration of
EUR2.165m (c. $2.54m) with an effective date of 1 Jan 2021. UOG
Italia Srl holds a 20% non-operated interest in the Podere Gallina
licence which contains the Selva gas development project in Italy.
United received a deposit of EUR108,235 (c.$150,000) in August
2021. The balance of the consideration and any working capital
adjustment from the effective date are payable on completion. The
sale is conditional upon the receipt of approval of the Italian
Authorities to the change of control of UOG Italia Srl and Prospex
completing a fundraising process. On 23 February 2022, Prospex
announced the completion of the fundraising with the proceeds to be
used for the acquisition of United's interest in Selva and to fund
the development costs of the Selva project. The longstop date for
completion is 6 April 2022. United and Prospex have been advised by
their lawyers that all information required for final approvals has
been submitted to the Ministry of Ecological Development on 10
February 2022.
Crown disposal milestone payment
The disposal of United's interest in the licence containing the
Crown discovery to Anasuria Hibiscus UK Ltd.(Hibiscus) completed in
December 2019 and United received $0.95m on completion. A further
$2.85m was payable to United on completion of certain milestone
events, or the licence could have been returned to United. In
October 2021, Hibiscus informed United that the licence terminated
on 30 September 2021. As announced in October, United sought legal
advice. Based on that advice the Company remains confident of its
legal position and is continuing constructive discussions with
Hibiscus. The Company looks forward to updating the market in due
course.
Pre-payment facility
Further to FY 2021 Trading and Operations Update and Guidance
for 2022 announcement issued on the 27 January, the Company has
extended the final maturity date on its existing prepayment
facility from 30 September 2022 to 31 December 2023. This extension
significantly lowers the monthly repayments and provides additional
flexibility for the execution of the Abu Sennan drilling programme
and general working capital management. United continues to have in
place a framework for potential future offtake and financing
undertaken by the Company.
**ENDS**
United's Chief Executive Officer, Brian Larkin commented:
"Although the conditions of the SPA for the sale of our UK CNS
assets were not met and United has decided to terminate the SPA
with Quattro , we believe the backdrop of high oil process and
increased investment in the North Sea means these licences offer a
range of exciting opportunities for United for limited near term
outlay.
"In respect of our other sales processes, we are pleased with
the progress being made. In Italy we have submitted final paperwork
to the relevant Ministry and are now waiting for final approvals.
Similarly, we remain confident of a prompt outcome regarding our
Crown disposal milestone payment which we hope to update
shareholders on in due course.
"With our low-cost producing asset base, which is significantly
leveraged to the rising oil price, we remain focused on
implementation of our work programmes from a fully funded position
in Egypt, in addition to progressing the farm out of our Jamaican
assets. We look forward to updating the market on further progress
in our full year results at the end of April."
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).
Glossary:
bopd - barrels of oil per day
boepd - barrels of oil equivalent per day
Enquiries
United Oil & Gas Plc (Company)
Brian Larkin, CEO brian.larkin@uogplc.com
Sharan Dhami, Head of IR & ESG sharan.dhami@uogplc.com
Beaumont Cornish Limited (Nominated
Adviser) +44 (0) 20 7628 3396
Roland Cornish and Felicity Geidt
Optiva Securities Limited (Joint
Broker) +44 (0) 20 3137 1902
Christian Dennis
Tennyson Securities (Joint Broker) +44 (0) 020 7186 9030
Peter Krens
Camarco (Financial PR/IR) +44 (0) 20 3757 4983
Billy Clegg | James Crothers | Tessa uog@camarco.co.uk
Gough-Allen
Notes to Editors
United Oil & Gas is a high growth oil and gas company with a
portfolio of low-risk, cash generative production, development,
appraisal and exploration assets across Egypt, UK, Italy 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
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END
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