Reabold Resources Plc (LON;RBD) Corporate and Project Update

Reabold is pleased to provide the following updates across its portfolio of projects and investments:


· Corallian’s two well drilling campaign at Wick and Colter to commence this month

· Reabold participating in a £912,300 Corallian fund raise to help fund Curlew-A appraisal well

· Significant options granted to Reabold for further investment into Danube Petroleum

· Further West Brentwood drilling prioritised ahead of Monroe Swell due to heavy rain at Monroe Swell

· West Newton A-2 well on track to drill in Q1 2019


Corallian Energy (“Corallian”)

As previously announced, Corallian, in which Reabold owns a 32.9 per cent. equity interest, anticipates that its two well drilling campaign will commence this month. The Ensco-72 Jack-Up rig will be initially mobilised to the Inner Moray Firth to drill the Wick prospect. Following completion of this well, the same rig will subsequently be mobilised to the south of England to drill the Colter prospect.



Corallian has also made considerable progress on the rest of its UK portfolio, including the farm out of 10 per cent. of the Curlew-A prospect to Talon Petroleum (UK) Limited as announced on 26 October 2018. Talon will pay 15 per cent. of the anticipated well cost to earn its 10 per cent. interest. Curlew-A has 2C unrisked contingent resource of 44.7 million barrels of oil equivalent.

As part of the overall funding of the Curlew well, which Corallian plans to drill in H2 2019, Corallian has raised £912,300 by way of an advanced subscription agreement. Reabold is participating in this fund raise with an investment of £300,000, maintaining its 32.9 per cent. equity interest. The additional shares to be issued under the advanced subscription agreement are priced at the higher of either a 30 per cent. discount to the price achieved in the next Corallian funding round, or at £1.50 per share (in line with the price per share at the last fund raise) if no funding round has occurred within 12 months.

Danube Petroluem (“Danube”)

Danube Petroleum, in which Reabold holds 1,879,700 ordinary shares representing a 33 per cent. equity interest, has made further progress on the Parta Appraisal Drilling and Development Operations. The manufacturing of key long lead items, including casing, tubing and wellheads, which are due for completion in mid February 2019, has commenced. In addition, efficient progress is being made with permitting for the drilling of the two wells both at a ministerial and local government level. Progress to date provides a high level of confidence that all relevant permits and authorisations will be granted during Q1 2019. The timing of completion of permitting and the availability of long lead items is expected to meet the scheduled timing of a firm drilling rig slot in Q1 2019 as previously announced under a drilling contract that was signed in October 2018 for one firm well and one option well.

As announced, in conjunction with the exercise of Reabold options to invest into Danube, Reabold and ADX Energy Ltd (“ADX”) have been discussing the timing of the ADX commitment to invest £375,940, either directly or via a third party, at £1.00 per share. This is the price per share at which all Reabold investments have taken place to date into Danube Petroleum.

As a result of this process, Reabold and ADX have agreed to extend the deadline for this investment, and have agreed the following funding commitments and options:

1. Under the terms of the Subscription Agreement, ADX has committed to either invest directly or source investment from a third party for £375,940 on the same terms as Reabold’s investments prior to 15 March 2019 (@£1.00 per share). In the event that ADX does not complete (or procure a third party to complete) the ADX Investment by 15 March 2019, ADX agrees to grant Reabold the right to subscribe to the shares at an issue price of £0.80 per Danube share.

2. Reabold will have the option to subscribe to a further 375,940 Danube shares at an issue price of £1.00 per share at any time prior to 15 March 2019.

In addition to the above, Reabold and ADX have agreed to grant the following options to subscribe for shares in Danube in order to provide funding for the second Parta Appraisal Well (“Second Parta Well Funding”):

1. Reabold may subscribe for a further 1,627,604 Danube shares at an issue price of £1.20 per share by electing to do so within six weeks of receipt of well logging data from the final logging run on the First Parta Appraisal Well. The monies raised by Daunbe, should Reabold elect to subscribe for these shares, would be £1,953,125

2. ADX may subscribe for a further 651,042 Danube shares at an issue price of £1.20 per share by electing to to do so within six weeks of receipt of well logging data from the final logging run on the First Parta Appraisal Well. The monies raised by Daunbe, should ADX elect to subscribe for these shares, would be £781,250.

3. Reabold and ADX may exercise their respective options to acquire shares up to a value of £1,953,125 for Reabold and £781,250 for ADX at any time prior to the spudding of the First Parta Well at a subscription price of £1.00 per Danube share rather than £1.20 per Danube share.

The agreed funding options provide a framework to fund the drilling, testing and completion for production of the two planned Parta Appraisal wells. Assuming the above funding options are exercised, up to £4,910,225 (ca USD 7 million) of funds would be provided to Danube by the parties. If the Second Parta Well Funding is subscribed for at a price of £1.20 per share, Reabold would hold a 45 per cent. shareholding in Danube and ADX would hold a 55 per cent. shareholding in Danube.

Reabold California

Integrity Management Solutions (“Integrity”), contract operator of the California assets in which Reabold has an interest, has informed the Company that whilst significant amounts of work have now taken place at the Monroe Swell drilling site, severe rainfall in California has rendered access to the site difficult for the heaviest equipment, which is hindering the ability to spud the well. Whilst a period of drier weather may quickly improve conditions sufficiently to allow access to the well, it remains uncertain as to exactly when this will occur.

As a result, Integrity will mobilise the rig to the West Brentwood site first, where it will drill the follow up to the successful VG-3 well before returning to Monroe Swell immediately afterwards. The next West Brentwood well will be drilled from the same pad that was constructed for the drilling of VG-3. The pad and the access road at West Brentwood were high graded to allow operations in winter weather conditions and Integrity does not expect any access issues. Reabold will update the market on spudding of the next West Brentwood well, which Integrity is targeting within the next few weeks.



Rathlin Energy

Following completion of Reabold’s investment into Rathlin Energy, work has now commenced at the West Newton A site ahead of drilling the West Newton A-2 well in Q1 2019. The second cellar on the site is due to be constructed prior to Christmas to allow conductor setting operations to take place in January 2019.

Sachin Oza, co-CEO, commented:

“We are very pleased to increase our stake in both Corallian and Danube where significant operational progress continues to be made. The considerable optionality that we have negotiated for additional investment into Danube is reflective of the type of deals that Reabold seeks in order to create shareholder value.

“While disappointing that exceptionally high rainfall has delayed the drilling of Monroe Swell we look forward to the drilling of the next West Brentwood well and our other near term, high value drilling projects. ”


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