Ascent Resources PLC (AIM:AST) Permitting Update

The Board of Ascent updates the market on the status of its IPPC Permit application. Recent developments

Since August 2018 the Company has received repeated private assurances from senior officials at the Environment Agency (“ARSO”), the lead regulator in the award of permits, that the issue of the long-awaited IPPC permit had been approved and would be confirmed imminently.

This weekend it was reported in the local press that the new Environment Minister, Jure Leben, had decided to make further enquiries into the permit.

Despite repeated efforts on our part we have been unable to get any meaningful comment from either ARSO or the Environment Minister.

Background

Over the past five years, the IPPC Permit application has been subject to detailed scrutiny by the Slovenian Environment Agency (ARSO), by the previous Environment Minister, by the Slovenian courts and by Environmental NGO’s during the public consultation process.

The proposed facility is not a complex installation and there are many similar facilities functioning in Europe without controversy.

The potential future gas production from Petišovci could create significant energy independence for Slovenia which currently imports 99.9% of its gas production, much of it sourced from Russia. It would also enable the country to transition away from coal and nuclear as their prime source of domestic electricity generation thereby reducing carbon dioxide emissions and long-term environmental risk.

Ascent has over the past 11 years invested some €50 million in Slovenia to allow Slovenians to produce their own gas.

As the permit has already been subject to years of detailed scrutiny and the benefits of the project to the Country are undeniable, the board can only conclude that the delaying tactics of ARSO and the decision by the new Environment Minister seem to be at odds with what is best for the country.

Proposed Action

The inability of investors in Slovenia to rely on bureaucratic processes or the rule of law in the country makes any investment in Slovenia by foreign companies extremely high risk.

In progressing our attempts to get the permits awarded we have become aware of similar cases in other industries, where overseas investors are suffering similar delays to Ascent’s. While we have the greatest respect for the Slovenian people, who we believe deserve better from their officials and their politicians who continue to profess the need for further foreign investment, we have regretfully reached the end of the line in waiting patiently for the Slovenian authorities to do the right thing.

It is clear to the Board that any legal action in Slovenia would be waste of shareholders money. Your board has therefore resolved to explore commencing proceedings against the Environment Agency (“ARSO”), the Environmental Minister and the state of Slovenia directly in the EU courts.

Further announcements will be made in due course.

Colin Hutchinson, CEO of Ascent Resources plc, commented:

“I am deeply disappointed that we have been let down once again by the Slovenian system given the private assurances received. I had hoped that the award of the permit would have marked the beginning of the next phase of the project, instead we are left once again reviewing our legal options to hold those responsible for the operation of the permitting system to account.”

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