$5m Senior Lending Facility & Operational Update
31 January 2018
Nostra Terra Oil and Gas Company plc
("Nostra Terra" or the "Company")
Completion of $5m Senior Lending Facility & Operational Update
Nostra Terra (AIM:NTOG), the oil and gas exploration and production company with a portfolio of assets in the USA and Egypt, is pleased to announce completion of its new Senior Lending Facility ("the Facility") with Washington Federal Bank.
As previously announced, the Facility size is US$5 million with an initial borrowing base of US$1.2 million, which is available for immediate use (the "Borrowing Base"). The Borrowing Base is based on oil production at Pine Mills, using a conservative oil price of US$36.50 per barrel or less for the next 6 years. The size of the Facility and Borrowing Base will be assessed at least twice a year and Nostra Terra's board (the "Board") expects both to grow as the Company increases its Proven 1P reserves and oil production.
With oil prices improving, Nostra Terra also has the opportunity to increase the size of the Facility and Borrowing Base by using the BP Energy Company Hedging Facility (as announced on 26 September 2017 and 19 October 2017). Nostra Terra has not yet hedged any of its production and further updates will be provided as and when appropriate.
Operational Update
Following the recent warrant exercises and completion of the Facility, Nostra Terra is well funded to accelerate its planned drill programme across its Permian Basin assets whilst keeping dilution for shareholders to a minimum. Nostra Terra's goal is to become cash flow positive at the corporate level through increasing oil production. The Company currently has 24 drill-ready locations to help achieve this target.
The completion process at Nostra Terra's recently drilled Twin Well continues to proceed according to plan and the Company expects it will come in slightly under budget. The Company will provide an update on progress in the coming days.
Once commercial flow testing of the Twin Well is finished, the Company expects to announce the next phase of its drill programme. Nostra Terra is currently working on the permitting process for three new wells across its Permian Basin acreage. Once the permits are received, the Company intends to commence drilling operations at its next well as soon as it can.
Matt Lofgran, Chief Executive Officer of Nostra Terra, commented:
"Completion of the new Senior Lending Facility is a watershed moment for Nostra Terra. Since we embarked on our new strategy two years ago we have been constrained by a lack of available finance. Previously we were able to grow and make shrewd transactions with limited capital. However, now that we have received such strong backing from Washington Federal Bank and our warrant holders, we are well capitalised to realise our ambition of becoming cash flow positive at the Plc level. Oil prices are at three-year highs, our assets are ready to develop and we have capital to continue drilling. With the Twin Well due to be put into production soon, this is an exciting time to be involved with the Company."
This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.
For further information, visit www.ntog.co.uk or contact:
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Nostra Terra Oil and Gas Company plc Matt Lofgran, CEO
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Tel: |
+1 480 993 8933 |
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Strand Hanson Limited (Nominated & Financial Adviser and Joint Broker) Rory Murphy / Ritchie Balmer / Jack Botros
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Tel: |
+44 (0) 20 7409 3494 |
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Smaller Company Capital Limited (Joint Broker) Rupert Williams / Jeremy Woodgate |
Tel: |
+44 (0) 20 3651 2910 |
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This information is provided by RNS
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