11 August 2016
UK Oil & Gas Investments PLC (London AIM and ISDX: UKOG) announced that following the issue and admission of 142,648,840 new ordinary shares in the Company to AIM, it has today completed the 100% acquisition of the 300 sq km (116 sq miles) Weald Basin licence PEDL234.
On 13th June 2016 UK Oil & Gas Investments PLC (London AIM and ISDX: UKOG) had previously announced that it has signed agreements with Celtique Energie and Magellan Petroleum to acquire 100% ownership of the 300 sq km (116 sq miles) Weald Basin licence PEDL234 (the "Licence"). The acquisitions more than double the Company's net acreage holdings in the prime Kimmeridge Limestone Oil province, as proven by the Horse Hill-1 ("HH-1") oil discovery which, as previously reported on 21 March 2016, flow tested at a commercial aggregate stable dry oil rate of 1,688 barrels of oil per day from the Kimmeridge Limestones and Portland section.
Importantly, the Licence includes regulatory permission to drill the Kimmeridge at the Broadford Bridge-1 ("BB-1") site. Furthermore, the licence contains a further mapped gas appraisal opportunity, in the eastern extension of the Godley Bridge Portland gas discovery.
The transactions are conditional upon the extension of the Licence and the usual regulatory approvals being granted by the Secretary of State for Energy and Climate Change ("Secretary of State").
For a total consideration of £3.5 million, the Company will obtain 100% ownership of the Licence via:
- a Share Purchase Agreement ("SPA") with Celtique Energie Petroleum Limited ("CEPL") to acquire Celtique Energie Weald Limited ("CEWL") who own a direct 50% interest in the Licence and;
- an Asset Transfer Agreement with Magellan Petroleum (UK) limited ("Magellan") who own a 50% interest in the Licence.
Additionally, via a second Asset Transfer Agreement, the Company will be assigned Magellan's 22.5% direct interest in offshore Isle of Wight licence P1916, taking UKOG's interest to 100%.
The consideration to CEWL, with an effective date of 10 June 2016, is comprised of £625,000 in cash and £1.125 million in the form of 71,324,415 UKOG ordinary shares. The consideration to Magellan for both Asset Transfer Agreements, with an effective date of 10 June 2016, is also comprised of £625,000 in cash and £1.125 million in the form of 71,324,415 UKOG ordinary shares. The issue of UKOG ordinary shares to both CEPL and Magellan is subject to a 6-month lock-in undertaking for both companies.