ADX Energy Ltd (ASX Code: ADX) announced that it has signed an agreement with Reabold Resources Plc (LSE AIM:RBD) (Reabold) to invest US$ 2 million in the recently incorporated Danube Petroleum Limited (Danube), currently a wholly owned ADX subsidiary, which (upon completion of transfers) will hold ADX’ 50% interest in the Parta exploration license (“Parta”), and 100% participating interest in the upcoming Parta Appraisal Program. The Appraisal Program comprises two redrill wells planned in the second half of 2018 to test 33 BCF of prospective and contingent resources defined on recently acquired 3D seismic, spread over a total of 5 gas reservoirs. Upon completion of the US$ 2 million investment Reabold will hold a 29% shareholding in Danube.
Upon completion of the transfer of the Parta exploration and appraisal interests to Danube, ADX will hold 3,759,400 shares in Danube valued at 1GBP per share (US$ 5,000,000 value) and Reabold will subscribe to a total of 1,503,759 shares in two tranches:
- 375,940 new shares at 1 GBP per share (US$ 500,000)
- 1,127,819 at 1 GBP per share (US$ 1,500,000) upon the issue by ADX (in its capacity as Operator) of an Authorisation for Expenditure (AFE) for the drilling of the first appraisal well. The funds will be held in an escrow account until the AFE is issued.
Reabold has an option to subscribe to a further 375,940 shares in Danube at 1 GBP per share that expires in 6 months following the completion of the transaction.
ADX has appointed Mr Philip Haydn Slater and Mr Ian Tchacos to the Board of Danube. Reabold has the right to appoint a director to the Board of Danube.
It is the intention of ADX to source a further US$ 2 to 3 million investment in Danube by mid 2018, which will provide sufficient funding to drill a second well in the Parta appraisal program. This will also satisfy ADX’s commitment under the agreement with Reabold to subscribe to or procure an investment into Danube Petroleum of at least £375,940 to fund the agreed work program at 1GBP per share or greater.
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated websites are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.