First tranche of investment in Danube Petroleum Limited completed
Reabold Resources, the investor in pre-cash flow upstream oil and gas projects, is pleased to announce the completion of the first tranche of Reabold’s investment in Danube Petroleum Limited (“Danube”).
As announced on 4 December 2018, the total investment is to be paid for in two tranches, the first tranche being the issue of 375,940 new ordinary shares in Danube for an investment of £1.00 per ordinary shares, with the second tranche due upon submission of an Authorisation for Expenditure for the first appraisal well, anticipated in Q3 this year.
Reabold’s total investment of £1.5 million for a 29% interest in Danube offers the Company exposure to the low-risk, high-impact Parta license (“Parta”), onshore Romania. In line with Reabold’s strategy, and as previously announced, a two-well appraisal campaign is scheduled for H2 2018, which aims to test 33 BCF prospective and contingent resources gross to Danube Petroleum.
As part of the appraisal campaign, two gas discoveries, one of which has previously flowed gas to surface, will be re-drilled.
Sachin Oza, Co-CEO of Reabold Resources, commented:
“Stephen and I are delighted to complete the investment in Danube Petroleum, which gives Reabold a unique exposure to the Parta appraisal campaign.
“The Parta appraisal campaign, scheduled for the second half of this year, is just one of many drilling opportunities to which Reabold shareholders are exposed over the next twelve months and one which we see significant optionality from.
“Through an innovative deal structure, Reabold, through Danube, has a significant interest in a low-risk appraisal campaign aimed to test 33 BCF of prospective and contingent resources that will generate $86m NPV to Danube Petroleum in a success case.”
Stephen Williams, Co-CEO of Reabold Resources, commented:
“Parta particularly stood out to us due to the low drilling and operating costs which meant the time to invest in the asset was now. The economics are extremely attractive based on current gas prices and the license is considered profitable at considerably lower gas prices.
“As part of the planned work programme, the appraisal wells are also intended to be producer wells. Danube can use the abundance of nearby infrastructure to readily monetise gas, thereby creating cashflow for Danube and subsequently Reabold. This cash can then be used to target further upside on the licence on which prospective resources of 300BCF of gas and 45 MMbbl of oil have been identified by the operator.”
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.
ENDS
