The Directors of Egdon Resources plc are pleased to announce that the Company is in advanced negotiations to acquire a portfolio of UK and French assets from EnCore Oil plc (“EnCore”).
The assets to be acquired would comprise of EnCore’s entire interest in 10 onshore UK licences, 2 onshore French licences and an interest in the Ceres gas field on the UKCS.
The consideration, which will be satisfied in Egdon Ordinary Shares, will be finalised as part of the contract negotiations and the transaction will be structured so that on completion EnCore’s ownership will not exceed 29.9% of the enlarged share capital.
The transaction is subject to final agreement of terms, completion of detailed due diligence, and shareholder and regulatory approval.
Egdon and EnCore expect to make further announcements in due course.
Commenting on the negotiations, Mark Abbott, Managing Director of Egdon said;
“This proposed transaction would mark a step change for Egdon’s portfolio. The assets significantly strengthen our opportunity base in the UK and France, with the Ceres field providing further near-term production and cash-flow coupled with the increased interest in the Kirkleatham gas field development to a more material 40% level. We also welcome the confidence placed in Egdon’s ability to add value to these assets by the management of EnCore through its shareholding in the Company.”
Commenting on the negotiations, Alan Booth, EnCore’s Chief Executive Officer said:
“We believe that by combining these assets with those of Egdon, we would expose our shareholders to more easily recognisable value in a more material portfolio of similar onshore assets. Egdon, as a committed and well established onshore player would be better placed to develop and add significant value to the enlarged asset base.
“We are firmly of the view that it is possible to build a meaningful onshore E&P business, however this will need both scale and management focus. It is our view that this transaction would enable Egdon to accelerate its transition into a significant onshore E&P player.”
For further information please contact:
Egdon Resources plc
Mark Abbott Managing Director
Ben Willey, Miranda Higham
020 7466 5000
Nominated Adviser and Broker – Seymour Pierce
Richard Redmayne, Jonathan Wright, Sarah Jacobs
020 7107 8000
Notes to Authors
The EnCore Assets:
The package of assets included in the deal are listed below:
|PEDL068 Cleveland Basin
|PEDL256 Weald Basin
|PEDL125 Weald Basin
|PEDL126 Weald Basin
|PEDL154 Weald Basin
|PEDL155 Weald Basin
|NP Weald Limited
|PEDL098 Wessex Basin
|PEDL240 Wessex Basin
|Mairy Paris Basin
|Nimes Rhone Graben
UKCS – Ceres
|P.1241 Southern North Sea
Egdon Resources plc
Egdon Resources plc is an established UK-based exploration and production company primarily focused on onshore exploration and production in the hydrocarbon-producing basins of the UK and Europe.
Egdon holds interests in twenty three licences in the UK and France and has an active programme of exploration, appraisal and development within its balanced portfolio of oil and gas assets. Egdon is an approved operator in both the UK and France.
Egdon has production from the Keddington and Kirklington oil fields in the East Midlands and the Avington oil field in Hampshire. Further oil and gas production is anticipated from Waddock Cross and Eakring-Dukes Wood during 2009 with Kirkleatham to follow in 2010.
Egdon Resources plc listed on AIM in January 2008, following the demerger of its gas storage business, Portland Gas plc. The pre-demerged business was formed in 1997 and listed on AIM in December 2004.
EnCore Oil plc
EnCore Oil plc (LSE:EO.) is an oil and gas exploration and production (E&P) company quoted on AIM.
It is not the Company’s aim to build a full cycle E&P company. The principal strategy is to create shareholder value through the successful exploration and appraisal of prospects and discoveries. The Company will seek to monetise or exchange the asset at the appropriate point in its life cycle and return value directly to shareholders wherever possible.
EnCore has an experienced and proven management team, a number of whom were responsible for the discovery of the Buzzard field in the UK North Sea, which currently produces over 10 per cent. of the UK’s total oil production.
All EnCore’s commercial and material technical evaluations are undertaken in-house by the EnCore team. This brings both continuity to the management and development of the assets and an ownership that is vital to unearth the best and most creative new ideas and opportunities.
In accordance with AIM rules – guidance for mining, oil and gas companies, the information contained in this announcement has been reviewed and signed off by the Managing Director of Egdon Resources plc Mark Abbott, a Geoscientist with over 23 years experience.