AIM-listed Reabold Resources as announced its audited results for the year ended 31 December 2021.

Highlights

West Newton

• During H2 2021, West Newton B-1Z and A-2 completion and testing operations commenced, evaluating the hydrocarbons in the conventional Kirkham Abbey Formation reservoir, which is key for the future development of the West Newton licence (PEDL183) and, in particular, for informing the optimal location for the drilling of the horizontal B-2 development well.
• With both gas and liquid hydrocarbons recovered to surface, the test programme provided further evidence that there is a substantial hydrocarbon column and resource in place. The updated Most Likely Median Case of in-place hydrocarbons over PEDL183 was estimated to be 412.3 mmbbl of oil and 183.5 bcf of gas.

Corallian   

• A further investment of £1.0 million into Corallian Energy Limited ("Corallian") was made by way of a Convertible Loan to fund the submission of a draft Field Development Plan ("FDP") for the Victory gas field, which was submitted at the end of 2021. The Company sold 50% of its Convertible Loan for net proceeds of £0.5 million to a group of strategic investors.
• Reabold acquired an additional 13.12% of Corallian shares from existing Corallian shareholders, in exchange for 468,994,086 new Reabold shares, resulting in the Company owning 49.99% of Corallian, thereby increasing its interest in the Victory gas discovery, wholly owned by Corallian.
• Completion of Environmental Baseline Survey, which was a key element in the submission of the Environmental Statement ("ES") for Victory.
• A CPR for the Victory project was completed, calculating a gross 2C recoverable resource of 179 bcf. The Victory development plan is relatively simple because, inter alia, it is adjacent to significant gas infrastructure. Corallian's 2C economic valuation (NPV10) of Victory, based on a historical average gas price of 50p/therm, is £193 million. Victory is an important resource and could contribute meaningfully to the UK's energy needs.

Reabold California

• Reabold entered into a conditional equity exchange agreement with Daybreak Oil and Gas Inc., a US over-the-counter traded oil and gas operator with assets in California, whereby Reabold will acquire up to 46.5% of Daybreak via the issuance of new Daybreak shares to Reabold, in exchange for Daybreak acquiring Reabold California, Reabold's subsidiary, which holds, inter alia, Reabold's licence interests in California.

Corporate and Other Activities

• The 18 month extension of the Parta Exploration Licence in Romania, held 100% by Danube Petroleum, in which Reabold has a 50.8% equity interest, for the current exploration phase until 3 December 2022.
• Oversubscribed placing and subscription at a premium to the prevailing market price to raise gross proceeds of £7.5 million, supported by key existing and new institutional investors.

Post reporting period highlights

• On 26 May 2022, Reabold announced the completion of the equity exchange agreement with Daybreak. Reabold California LLC, Reabold's subsidiary which holds, inter alia, Reabold's licence interests in California, has now become a wholly owned subsidiary of Daybreak, which, in exchange, has issued 160,964,489 new Daybreak shares to Gaelic Resources Limited, a wholly owned subsidiary of Reabold. Reabold now indirectly owns 42%of Daybreak's share capital, as enlarged by the completion of the transaction.
• On 4 May 2022, Reabold announced that Corallian had received a non-binding, conditional offer from a credible party for the acquisition of its entire issued share capital. Corallian's board considers the Potential Sale to be sufficiently attractive to seek to conclude a sale process and is progressing negotiations with the potential purchaser.
• As part of the Potential Sale process, Reabold announced that it had entered into a conditional sale and purchase agreement ('SPA') to acquire Corallian's working interest in all the non-Victory licences within the Corallian portfolio for a cash consideration of £250,000. The licences that will be acquired by Reabold are P2396, P2464, P2493, P2504 and P2605 (all at 100% working interest) and P2478 (36% working interest), which the Board believes have significant prospective potential.
• RPS Group estimated that a horizontal optimised well drilled at West Newton could deliver an initial production rate of ca 35.6 mmcf/d of gas over the first month of production.
• East Riding of Yorkshire Council Planning committee approved planning applications for drilling and production at Rathlin's West Newton A site as well as a time extension to allow for further drilling at the West Newton B site, paving the way for the next phase of activity at West Newton towards development.

KeyFacts Energy: Reabold Resources UK country profile