Update on Horse Hill Prospect

RNS Number : 4223O

Regency Mines PLC

06 August 2014

 



6 August 2014

Regency Mines PLC

("Regency" or the "Company")

Update on Horse Hill Prospect, UK.

Environment Agency Permits Granted

Further to the announcements of 11 July 2014 and 21 July 2014, Regency (AIM:RGM) announces that the operator of the Horse Hill U.K. onshore oil and gas exploration project, Horse Hill Developments Ltd ("HHDL"), has been granted final approvals from the UK Environment Agency to proceed with the drilling of the Horse Hill -1 well at Horse Hill in Surrey.

Regency has a binding Heads of Agreement in place with HHDL giving rights to ownership of a direct 5% interest in HHDL, a special purpose company that has operatorship of the Horse Hill-1 well on the Horse Hill Oil Field in the Weald Basin and upon completion of the Horse Hill-1 well, will own a 65% participating interest. Regency also owns 12.56% of Alba Mineral Resources plc (AIM:ALBA)("Alba") that has an identical Heads of Agreement in place with HHDL also giving rights to a 5% interest in HHDL.

Andrew Bell, the Company's Chairman, commented:

"Several days in site construction works have been lost due to weather as the heavy clays present at surface in the license area do not drain well after heavy rainfall. The concrete collar is on site ready for installation and spudding of the well is expected shortly, when a further announcement will be made.

This is, we believe, one of the largest if not the largest U.K. onshore prospect to have been drilled in recent decades. The potential impact of success would be considerable. To clarify one point, we are investing in a vertical conventional well like other producing wells nearby and we are not investing in a fracturing project."

The participants in the Horse Hill-1 well are HHDL (Operator) with a 65% working interest and Magellan Petroleum Corporation with a 35% interest. Co-investors in HHDL besides Regency include Alba, include Angus Energy Ltd, Solo Oil Plc (AIM:SOLO), Doriemus Plc (AIM:DOR), Stellar Resources Plc (AIM:STG) and UK Oil & Gas Investments Plc (AIM:UKOG).

Note

The total consideration payable by the Company for the 5% interest in HHDL is £300,000. An initial non-refundable deposit of £10,000 was paid on signing of the HOA and the balance is subject to completion and execution of definitive agreements which the parties are currently finalising. At completion, RGM will make further payments of the balance of £290,000 required for drilling the well. Following the payments, Regency will own 5% of HHDL and will upon completion of the well indirectly hold a 3.25% beneficial interest in PEDL 137.

For further information contact:

Andrew Bell 0207 747 9960 or 0776 647 4849                                         Chairman Regency Mines Plc

Colin Aaronson / David Hignell 0207 383 5100                                        NOMAD Grant Thornton UK LLP

Nick Emerson 01483 413500                                                                        Broker SI Capital Ltd.

Rupert Trefgarne 0203 128 8817                                                                Media Relations MHP Communications

-ENDS-

 

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