Reabold Resources plc has increased its interest for £2 million in the Colle Santo gas field in the Abruzzo region, onshore Italy.
TERMS
The company’s initial 3.1% interest now stands at 16.2% in LNEnergy which holds a 90% interest in the field.
Reabold will pay £500,000 with existing cash and £1,500,000 with 810,810,811 new ordinary shares of 0.1p each in the company at 0.185 pence per ordinary share.
The company retains a second option, expiring 30 November 2023, to acquire a further 10.5% for £1,800,000 with either cash or shares, at LNEnergy’s choice.
If exercised, Reabold will hold a 25% interest in the enlarged share capital of LNEnergy for a total cash and equity consideration of £4,050,000.
On admission of 810,810,811, the total issued share capital of the company will consist of 9,988,198,720 ordinary shares, each with voting rights. Reabold holds 48,812,617 ordinary shares in treasury.
COLLE SANTO
Colle Santo, discovered in 1966, holds 65bcf of 2P reserves and is ready for development subject to approvals and permits.
Reabold added that two production wells were already drilled, with no additional drilling required, for first gas targeted in early 2025.
Since the initial agreement in May, the company has conducted “significant due diligence work, resulting in increased confidence in the likelihood of permits being granted for field development”.
A two-year, long-term production test is currently under review and approval for full production concession is expected during 2024 to allow production for more than 20 years.
Reabold said its investment supported the process for development engineering and approvals prior to project financing to bring the project to first gas.
“The potential in the Colle Santo gas field presents an exciting opportunity for Reabold to pursue its investment strategy to fund low risk, near-term projects with a clear path to generating cash flow,” added co-chief executive officer Stephen Williams.