Mosman Oil and Gas Limited EP 145 Funding by Farmin Agreement (2392Q)
16 Ottobre 2023 - 11:31AM
UK Regulatory
TIDMMSMN
RNS Number : 2392Q
Mosman Oil and Gas Limited
16 October 2023
16 October 2023
Mosman Oil and Gas Limited
("Mosman" or the "Company")
EP 145 Funding by Farmin Agreement
Mosman Oil and Gas Limited (AIM: MSMN) the hydrocarbon, helium
and hydrogen exploration, development and production company, has
signed a farmin agreement with Greenvale Gold Pty Ltd ("Greenvale")
a wholly owned subsidiary of Greenvale Energy Ltd (ASX:GRV) to fund
seismic and drilling on its EP 145 project in the Northern
Territory of Australia.
Upon Completion, Mosman will retain a 25% working interest in EP
145 and Greenvale will earn a 75% working interest in EP 145
by:
-- Committing to pay AUD160,000 in cash within 5 days of Completion
-- Paying for the EP 145 Permit Year 3 Work Program, including
seismic, effective from Completion Date
-- Funding the Permit Year 4 Work Program, including drilling
one well with a well cost cap of AUD5.5 million
-- The Year 3 Work Program is to be completed by August 2024 and
the cost of the seismic acquisition is estimated to be circa AUD2
million
-- The Year 4 Work Program is to be completed by August 2025.
The cost of drilling a well depends on many factors including the
depth of a well and cost of drilling rigs at the time of
drilling
Mosman has identified a drilling target at 1500m and estimates
the cost of drilling that well to be in the order of AUD5m.
However, the final location and well design is subject to seismic
results, joint venture discussions and NT government approval.
Costs of the well over AUD5.5 million and any other costs will be
shared Greenvale 75% and Mosman 25%.
The Farmin Agreement Completion is subject to NT government
approval of the transfer of interest and Greenvale becoming
Operator. If these approvals are not met by 30 January 2024, either
party may terminate the Farmin Agreement.
EP 145 has potential for hydrocarbons, helium and hydrogen. The
Prospective Resource was announced on 24 October 2022 with "Best
Estimate" per SPE PRMS of 440 Billion cubic feet ("Bcf") Total Gas,
including 26 Bcf of Helium and 26 Bcf of Hydrogen.
EP 145 had a carrying value in Mosman's consolidated accounts of
AUD1.29 million as at 31 December 2022. Exploration costs to date
have been capitalised and there are no historic profits or losses
attributable to EP 145. The AUD160,000 proceeds due to Mosman will
be utilised for general corporate purposes.
As part of the Corporate Review, Mosman evaluated various
options with regard to funding the exploration program at EP 145.
This farmin is considered the best alternative as it contracts out
the funding for Permit Year 3 without the need for Mosman to raise
additional capital for such purposes. The agreement also includes
up to AUD5.5 million funding for the Year 4 Work Program including
well drilling costs. The alternative of funding EP 145 with a "spin
out" IPO would have required Mosman funding of the significant IPO
costs, would depend on capital markets at the time of IPO, and
would have resulted in additional ongoing corporate costs. The IPO
was not certain of success and may not have raised the funds in the
limited time available to ensure funding the seismic that requires
commitment to long lead items in 2023.
Andy Carroll, CEO, commented : "We are pleased to have reached
agreement with Greenvale who we see as a strong Joint Venture
partner to work with in Australia. This agreement delivers on
funding exploration and is validation of the helium, hydrogen and
hydrocarbon potential of EP 145."
About Greenvale
Greenvale is listed on the ASX in Australia and has a market
capitalisation of over AUD$30 million. The Chairman is Neil Biddle,
who founded Pilbara Minerals that now has a market capitalisation
of over $13 billion. Greenvale has a large bitumen resource in
Queensland and geothermal projects.
Market Abuse Regulation (MAR) Disclosure
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 ('MAR') which has
been incorporated into UK law by the European Union (Withdrawal)
Act 2018. Upon the publication of this announcement via Regulatory
Information Service ('RIS'), this information is now considered to
be in the public domain.
Enquiries:
Mosman Oil & Gas Limited NOMAD and Joint Broker
Andy Carroll, CEO acarroll@mosmanoilandgas.com SP Angel Corporate Finance LLP
Stuart Gledhill / Richard Hail / Adam
Cowl
+44 (0) 20 3470 0470
Alma Joint Broker
Justine James CMC Markets UK Plc
+44 (0) 20 3405 0205 Douglas Crippen
+44 (0) 7525 324431 +44 (0) 020 3003 8632
mosman@almapr.co.uk
Updates on the Company's activities are regularly posted on its
website:
www.mosmanoilandgas.com
Notes to editors
Mosman (AIM: MSMN) is an oil exploration, development, and
production company with projects in the US and Australia. Mosman's
strategic objectives remain consistent: to identify opportunities
which will provide operating cash flow and have development upside,
in conjunction with progressing exploration of its existing
exploration permit and permit application. The Company has several
projects in the US. In addition to exploration projects in the
Amadeus Basin in Central Australia.
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