Reabold maintains holding in Corallian Energy after latest funding round

(Sharecast News) - Oil and gas investment company Reabold Resources has participated in the second tranche of Corallian Energy's recently-completed round six fundraise, it announced on Friday.
The AIM-traded firm said it subscribed for 47,727 new ordinary shares in Corallian at a subscription price of £2.20 per ordinary share, for an investment of £0.105m, being Reabold's pro rata share.

In aggregate, Corallian raised £0.3m with the fundraise, via the issue of 136,363 ordinary shares at the subscription price.

Reabold said its equity interest in Corallian remained unchanged, at 34.9%.

"Corallian will use the subscription proceeds to prepare for a planned initial public offering early in the second half of 2020, and to complete the work required to finalise UK North Sea well locations for both the Unst prospect in the Viking Graben and the Dunrobin prospect in the Inner Moray Firth," Reabold explained in its statement.

"The Unst gas prospect, in licence P2464, has an unrisked Pmean prospective resource estimated by Corallian of 68 billion cubic feet of gas in the Eocene Frigg sandstone prospect with seismic amplitude support, potentially analogous to that at the nearby Nuggets Fields." Corallian currently held a 100% interest in that licence.

"The Dunrobin prospect, in licence P2478, has an unrisked Pmean prospective resource estimated by Corallian of 187 million barrels of oil equivalent in the Beatrice Formation and Dunrobin Bay Group sandstones."

Corallian holds a 45% interest in the licence, and is the licence administrator as defined by the UK Oil & Gas Authority in the current, initial phase of the licence.

A farmout process for the Unst and Dunrobin wells would be launched by Corallian at the 'Prospex' industry event in December, Reabold noted.

It said progress was being made in discussions on the farmout of a further interest in the planned Curlew-A well in licence P2396.

"The well is planned to be an appraisal of the Shell 1977 Curlew-A Tertiary oil discovery.

"A competent person's report for the discovery has been completed by Schlumberger Oilfield UK."

That report estimated best estimate unrisked contingent resources (2C) aggregate resources of 39 million barrels of oil equivalent in Cromarty and Odin Tertiary aged sandstones.

In addition, Corallian estimated most likely unrisked prospective resources of 22 million barrels of oil in the Forties sandstone, and eight million barrels of oil in the Chalk.

The rig site survey for the Curlew-A appraisal well was completed in August 2019.

Corallian holds a 90% interest in the licence, with Talon Petroleum holding a 10% interest, paying 15% of the cost of the Curlew-A well capped at a gross well cost of £12m.

"Corallian has submitted applications in the 32nd Seaward Licensing Round of the Oil and Gas Authority," Reabold added.

"Warrants have been granted to all shareholders on the basis of one warrant for every four shares held.

"These can be exercised up to 30 working days following any offer of a licence that may be made by the OGA to Corallian next summer, at an exercise price of £2.20 per warrant share."

For the year ended 31 October 2018, Corallian reported net assets of £6.23m and a loss for the year of £0.42m.

At 1056 GMT, shares in Reabold Resources were up 0.57% at 0.86p.