Farm-in to Colter and Issue of Equity
Tuesday 25 September 2018
Andalas Energy and Power Plc, announced it has, through its 100% owned subsidiary Resolute Oil & Gas (UK) Limited, entered into an agreement with Corallian Energy Limited under which it has acquired, via a farm-in, an 8% interest in UK Continental Shelf Licence P1918, which contains the Colter prospect and PEDL 330 and PEDL 345.
In addition, the Company has raised £800,000 (gross) at 1.15 pence, via an oversubscribed placing, which, together with existing funds, fully finances the expected costs of the Acquisition. The Placing Price represents a 2% discount to the closing mid-market share price on 20 September 2018.
Highlights:
- Farm-in to Colter prospect fully funded through to drilling of the well expected in Q4 2018, expected well cost £7.5m gross.
- To earn its 8% interest Andalas is funding 10.67% of the well cost up to a maximum of £8million, thereafter it funds 8%.
- Colter scheduled to be drilled in Q4 2018
- Colter will evaluate a prospect that has been assessed to contain gross unrisked Mean Prospective Resources of 22 million barrels of oil (“MMBO”) recoverable (1.76MMBO net) (Operator estimate).
- Andalas portfolio now contains short, medium and long term value catalysts, each with significant potential and activity expected over the remainder of 2018 including:
- Progress updates on our interest in the Badger licence, including updates on the ongoing farm-out process;
- Updates on the licence extension at our recently announced Bunga Mas project; and
- Drilling of the Colter well planned for Q4 2018.
- £800,000 (gross) raised via the issue of 69,565,217 new ordinary shares of no par value, at a price of 1.15 pence per share.
- Funds to be applied to fully fund the farm-in;
- 34,782,608 (on a 2 for 1 basis) warrants will be issued in connection with the placing. Warrants have an exercise price of 2pence and a three year life.