Update on Crown Disposal Milestone Payment

RNS Number : 5266H

United Oil & Gas PLC

04 December 2020

 

United Oil & Gas PLC / Index: AIM / Epic: UOG / Sector: Oil & Gas

4 December 2020

United Oil and Gas plc (United)

Update on Crown Disposal Milestone Payment

United Oil & Gas PLC (AIM: "UOG"), the growing oil and gas company with a portfolio of production, development, exploration and appraisal assets offers an update on the milestone payment  from Hibiscus Petroleum Berhad's indirect wholly-owned subsidiary, Anasuria Hibiscus UK Limited ("Anasuria Hibiscus") for the purchase of Licence P2366, Blocks 15/18d and 15/19b, which include the Crown discovery. 

On December 12^th 2019, Anasuria Hibiscus completed the acquisition of 100% interest in the named blocks from United and Swift Exploration Limited ("Swift Exploration") for a total cash consideration of up to US$5 million, to be paid based on a series of planning milestones and production targets.

A payment of US$1m was received from Anasuria Hibiscus on completion in December 2019.  A payment of US$3m (US$2.85m to United) is due to be paid within 7 days of the actual date of approval of the Marigold Field Development Plan ("FDP"), which includes the development of the Crown discovery as part of the overall Marigold development ("FDP Approval"), by the UK's Oil and Gas Authority ("OGA").  This approval was expected to be received by the end of 2020.  

Anasuria Hibiscus is currently in advanced stages of drafting the final FDP and has been in pre-submission discussions with the regulator to ensure the FDP meets their requirements. As a result of delays, which are in large part due to the impact of Covid-19, we have been informed by Anasuria Hibiscus that whilst the FDP will be submitted on schedule by the end of December 2020 the project final investment decision ("FID") which triggers the OGA approval of the FDP is now expected to be around the end of March 2021. It is clear that Crown remains an important and value accretive part of the Marigold Development, and as a result of this delay and following recent discussions with Anasuria Hibiscus the US$2.85m payment is now expected to be in the second quarter of 2021.

In the event FDP Approval is not achieved, Anasuria Hibiscus may, at its discretion, proceed with the US$3 million payment or transfer License P2366 back to United and Swift Exploration at nominal consideration without any further payment obligation.

An announcement on this matter will also be made by Hibiscus Petroleum Berhad and  can be accessed on https://www.hibiscuspetroleum.com/

United Chief Executive Officer, Brian Larkin, commented:

"The short delay in this FDP Approval is understandable under the current circumstances where project timelines are being impacted by Covid-19 and does not have any impact on United's plans to recommence drilling in Egypt which will be funded from operating cashflow."

ENDS

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR").

United Oil & Gas Plc (Company)
Brian Larkin, CEO	[e-mail]
Beaumont Cornish Limited (Nominated Adviser)
Roland Cornish and Felicity Geidt	[phone]
Optiva Securities Limited (Joint Broker)
Christian Dennis	[phone]
Cenkos Securities Plc (Joint Broker)
Joe Nally (Corporate Broking) Derrick Lee and Pete Lynch	[phone] [phone]
Murray (PR Advisor)	[phone]
Joe Heron	[e-mail]
Camarco (Financial PR/IR)
Billy Clegg Georgia Edmonds James Crothers	[phone] [e-mail]

Notes to Editors

United Oil & Gas is a high growth oil and gas company with a portfolio of low-risk, cash generative production and development assets across Egypt, UK, Italy and a high impact exploration licence in Jamaica.

Led by an experienced management team with a strong track record of growing full cycle businesses and partnered with established industry players, the Company 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  https://www.uogplc.com/  

 

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