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Attis Oil & Gas Ltd / Index: AIM / Epic: AOGL/ ISIN: VGG6622A1057 / Sector: Oil and Gas

12 May 2020

Attis Oil & Gas Ltd ('the Company')

Update on Asset Sale Programme 

Attis Oil & Gas Limited ("Attis") today announces that, in line with the asset sale strategy announced on 1 January 2020, it has disposed of its subsidiary company, Northcote Cleveland LLC, which holds the Zink Ranch lease, for a consideration of $250,000 payable in cash over the next 4 months plus assumption by the acquirors of the $50,000 operator's bond currently held by the Company.

The disposal was to a consortium of buyers which included Paolo Amoruso, Executive Chairman of the Company, who purchased a 20% interest in Northcote Cleveland LLC. The disposal is therefore a related party transaction pursuant to the AIM Rules for Companies. The independent Directors consider, having consulted with the Company's nominated adviser, that the terms of the transaction are fair and reasonable insofar as the Company's shareholders are concerned. In taking this judgement into account they note that the cash consideration for the sale of Zink Ranch lease was US$25,000 higher than that offered by a third party.

In addition, and further to the Company's announcement of 19 February 2020, the Company has now disposed of its interests in the Fort Worth field for a nominal amount and the relinquishment of the bond associated with the field for the assumption by the acquiror of the plugging and abandonment ("P&A") and tax liabilities on the 98 wells on the field.

The Board advised shareholders in February that APEG, the Company's JV partner in the Fort Worth field, had not been meeting its financial obligations and the field had been operating at a loss given the historically low natural gas prices in the US. Further, the disposal of the field avoids any operator P&A liabilities which are currently estimated at approximately $25,000 per well.

In the six months to 30 June 2019, the Zink Ranch lease contributed no revenue to the Company and was carried on the Balance Sheet at $500,000 as at that date whilst the Company's interest in the Fort Worth Field contributed revenue of $229,921 to the Company and had cost of sales $79,219 and was carried on the Balance Sheet at $2,021,000.

The Company is still the owner and operator of the Austin Field in Texas. Production at the field is currently shut-in given the oil price environment. The proceeds from the disposals above will be used for general working capital purposes.

**ENDS**

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