MetalNRG plc (LON:MNRG) the natural resource investing and exploration company gives an update on the Oil & Gas exclusivity agreement, entered into with the owner of an established operating company (the “Operating Company”) based in Romania (the “Vendor”), which owns 100% of an oil and gas concession, valid to 2034, as announced on 29th of November 2019.
The purpose of the exclusivity agreement is to give a period of exclusivity to MetalNRG and to set out the principle terms upon which the Vendor is willing to sell a 75% interest in the issued share capital of the Operating Company, in consideration of an upfront payment and a free-carry component of the initial development capital for the project.
Progress has been made with the due diligence process and the findings from our work to date are in line with our strategy, to seek projects that offer low acquisition costs, early-stage cashflow generation and upside exploration opportunity.
We have appointed a global independent oil and gas consultancy to supply us with independently verified resource estimates.
Alongside the due diligence process, we have been assessing a number of financing solutions for the transaction. In particular, we have made progress with a debt development package, which we believe to be the optimal way to fund the current transaction.
In order to allow completion of the ongoing processes, we have agreed with the Vendor an extension of the exclusivity period up to the end of March 2020.
Rolf Gerritsen, CEO of MetalNRG commented “I am pleased with the progress so far, not only for our due diligence but also for the opportunity of a debt-based financing option, which would allow us to complete the transaction. We have now extended the exclusivity period to ensure that all elements of the transaction are dealt with in good order and I look forward to supplying further updates within the forthcoming weeks.”
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