PXEN Prospex Energy Plc

Prospex Energy PLC / Index: AIM / Epic: PXEN / Sector: Oil and Gas

25 July 2024

Prospex Energy PLC

("Prospex" or the "Company")

Spanish Government Grants 10 -year Licence Extension

on El Romeral Production Concessions

Prospex Energy PLC (AIM: PXEN), the AIM quoted investment company focused on European gas and power projects, is pleased to announce that the Spanish regulatory authority has granted a ten-year extension, to July 2034, to the natural gas production concessions owned by Tarba Energía S.L. ("Tarba") known as El Romeral 1, 2 & 3 from which Tarba generates electricity from its own natural gas production.

The Royal Decree was signed on 24 July 2024 allowing the Ministry for Ecological Transition and the Demographic Challenge (MITECO) to grant the extension of the natural gas exploitation concessions "El Romeral 1, 2 and 3" for ten years, the maximum allowable term, thus guaranteeing electricity supply to the grid until at least July 2034, when the concessions may be extended for a further ten-year period, reaching 2044.

Tarba's electricity production plant in Carmona near Seville was declared a Public Utility by the Andalusian Regional Government at the beginning of 2023 and is the only facility in Spain that converts electricity from natural gas at the same location as the gas is extracted from the subsurface.

Applications to permit the five well drilling campaign on the concessions is already with MITECO for permitting approval.

The El Romeral power plant is operated by Tarba, which is based near Carmona east of Seville in the province of Andalucía, Spain.  The El Romeral asset is co-owned through Tarba by Prospex which has a 49.9% working interest and Warrego Energy Limited which has a 50.1% working interest.  Warrego Energy is now wholly owned by Hancock Energy (PB) Pty Ltd in Perth Western Australia.

Tarba is pioneering a new hybridisation model that combines natural gas and solar energy as sources for electricity generation in the ecological transition process by developing a project to produce 5MW electricity using photovoltaic solar energy ("Project Helios").

In 2023, Tarba supplied enough energy to cover the electricity consumption of approximately 6,700 homes in the area, even when operating the facility at one third of its capacity.  With future wells to be drilled on the concessions, the plant is expected to reach its maximum nameplate production capacity to sell 8.1MW of power into the grid.  The combination of further natural gas extracted from the concessions and the new photovoltaic generation is expected to cover the energy supply of 20,100 homes.

Mark Routh, Prospex's CEO, commented:

"The official extension of the El Romeral production concessions for the maximum allowable term of ten years, is a very welcome step by the Spanish regulatory authorities.  It is also an important official acknowledgement by the Spanish state of the crucial role natural gas will continue to play in the nation's energy security and the ecological transition process. 

"It is important to highlight that the El Romeral power plant will reach full output capacity from production of just two of the proposed five wells.  Any extra gas from the remaining new wells or any future wells drilled on the concessions will facilitate expansion plans at the power plant as well as the ability to supply natural gas directly to the grid or to the local market in Andalucía."

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR") and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

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For further information visit www.prospex.energy or contact the following:

Notes

Prospex Energy PLC is an AIM quoted investment company focussed on high impact onshore and shallow offshore European opportunities with short timelines to production.  The Company's strategy is to acquire undervalued projects with multiple, tangible value trigger points that can be realised within 12 months of acquisition and then applying low-cost re-evaluation techniques to identify and de-risk prospects.  The Company will rapidly scale up gas production in the short term to generate internal revenues that can then be deployed to develop the asset base and increase production further.

About El Romeral and Tarba

The El Romeral gas and power project in Spain, with gas production wells supplying gas to an 8.1MW power plant near Carmona in Southern Spain is owned and operated by Tarba.  It is currently operating at about 30% of its full capacity because Tarba is waiting on permits to drill five further infill wells on the concessions to increase production.  Tarba is already categorised as a hybrid energy provider with the successful installation of photovoltaic panels on the roof of the plant in August 2022.  Prospex owns a 49.9% working interest in the El Romeral project via Tarba.  The remaining 50.1% working interest is owned by Warrego Energy Limited now wholly owned by Hancock Energy (PB) Pty Ltd in Perth Western Australia.  Tarba sells electricity generated from the plant on the spot market in Spain.  The El Romeral licences comprise three contiguous production concessions.