LONDON (Alliance News) - Regency Mines PLC shares rose Tuesday after it joined the string of AIM-listed companies involved in the Horse Hill project in southern England, completing its purchase of a stake in the project.
Regency shares were up 28% to 0.800 pence per share on Tuesday morning.
Regency Mines said Tuesday it has completed the purchase of a 5% stake in Horse Hill Development Ltd, one of the owners of the Horse Hill project, from Angus Energy PLC, for a total of GBP400,000. Of the total consideration, GBP223,730 has been paid in cash.
That deal was originally announced Monday, and Regency is partly paying the consideration through the issue of 54.2 million new shares to Angus Energy at a price of 0.325 pence each. In addition, Regency has provided Angus with options over another 17.9 million shares which can be exercised at 0.39 pence each within the next 18 months.
Excluding the options, the 54.2 million shares issued to Angus represent 29.89% of Regency's enlarged issued share capital.
If the options are exercised by Angus, it would push its stake in Regency up to around 36.18%.
Horse Hill Development owns a 65% participating interest in the PEDL 137 and PEDL 246 licences in the UK Weald Basin. A discovery was announced in October at the Horse Hill-1 oil discovery well at PEDL 137, and successful flow tests were announced earlier this month at the first of three zones to be tested at the well.
None of the other AIM-listed companies will see their stakes in Horse Hill Development change following the deal.
UK Oil & Gas Investments PLC holds a 30% stake in Horse Hill Developments, whilst Doriemus PLC, Stellar Resources PLC, Solo Oil PLC and Alba Mineral Resources PLC each hold 10% stakes in Horse Hill Developments, with Evocutis PLC holding a 2% stake. UK Oil & Gas Investments also holds a 6% stake in Angus Energy.
Last week, the companies said oil had flowed from the Horse Hill-1 well, averaging a production rate of 463 barrels of oil per day over a seven-hour period on the first day and averaging 456 barrels of oil per day on the second day of testing, which was conducted over a nine-and-a-half hour period.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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