Reabold Signs Deal to Raise Stake in West Newton Field in East Yorkshire
AIM-listed oil & gas investment company Reabold Resources Plc has entered into an agreement with privately held Humber Oil & Gas Ltd. to acquire its 16.665% interest in UK onshore exploration licence PEDL183, which contains the West Newton field.
The transaction consideration is comprised of £1.4 million in cash and the issue of 350 million ordinary shares of 0.1p each of Reabold. According to the sales agreement, Humber has agreed to a lock-up of over 66.67% of the consideration shares for a period of 3-months from the date of admission to trading on the AIM Market of LSE and an orderly market restriction for a further 3-month period once the lock-in period expires.
Following the completion of the acquisition, Reabold’s stake in the licence will increase from 39.66% to 56.48%, which includes a direct 16.665% and an indirect 39.66% interest held through its 59.48% shareholding in Rathlin Energy Ltd., the operator of the license.
PEDL183 covers an area of ~176,000 gross acres in East Yorkshire, located within the western sector of the Southern Zechestein basin. The West Newton field is estimated to contain 146.4 million barrels (MMbbls) of oil initially in-place (OIIP) along with 211.5 billion cubic feet (Bcf) of gas initially in-place (GIIP) in the Kirkham Abbey formation.
“Our increased investment should facilitate the unlocking of the large potential value we see at West Newton and we look forward to the upcoming activity, including the drilling of the B-1 well where site construction is currently underway,” said Reabold’s CEO Stephen Williams.
To ensure liquidity to carry out the planned drilling activities in the field, Reabold has also secured a £5 million discretionary cash facility from Acuitas Capital LLC. The 24-month facility is a prudent measure to provide increased liquidity without the need to dilute shareholders’ equity, the company stated.
The completion of the acquisition is conditional upon the receipt of approval from the UK’s Oil & Gas Authority (OGA).