Echo Energy Regulatory News (ECHO)

6 December 2016

Independent Resources Plc("Independent Resources" or the "Company")

Placing of up to 958.245million new Ordinary Shares in the Company ("Shares") to raise gross proceeds of up to £766,596 ("the Placing"), comprising up to £500,000 of new cash funding and the conversion of £266,596 of Company indebtedness

Introduction

The board of directors of Independent Resources plc (AIM: IRG) ("Board") is pleased to announce that it has conditionally raised up to GBP766,596 of new finance (before expenses) by the placing ("the Placing") of up to 958,245,000 new Ordinary Shares of 0.01p in the Company ("Placing Shares") at a price of 0.08 pence per Placing Share ("Placing Price"). The Placing was effected using the Company's existing authorities to allot shares on a non pre-emptive basis which were obtained from shareholders at the Company's General Meeting on 25 April 2016. The Placing is conditional upon admission of the Placing Shares to trading on AIM.

Further details on the Placing

The Placing comprises two elements:

- Up to £500,000 of gross new cash proceeds through the issue of up to 625,000,000 new Ordinary Shares to institutional and other investors ("Cash Placees") at the Placing Price

- Brandon Hill Capital Limited ("Brandon Hill") agreeing to subscribe for 333,245,000 Placing Shares at the Placing Price in full and final settlement of £266,596 of indebtedness, (including accrued interest thereon), drawn down by the Company pursuant to two loan agreements entered between the Company and Brandon Hill ("the Brandon Hill Loans"), as announced to the market on 29 September 2016 and 14 October 2016 respectively. Following this debt repayment, the Company will still have £240,000 of the facility available to it from Brandon Hill under the Brandon Hill Loans

The net new cash funds expected to be received by the Company from the Placing are approximately £461,670.

The Company has also agreed to grant the Cash Placees warrants to subscribe for up to 625,000.000 Shares at a price of 0.12p per Share at any time up to 2 years from the date of their grant and to grant Brandon Hill 333,245,000 warrants in respect of their conversion of debt on the same terms as the warrants to the Cash Placees. In addition the Company has granted Brandon Hill warrants exerciseable within two years from their date of grant to subscribe for 47,912,250 Shares at the Placing Price as part of Brandon Hill's fees for undertaking the Placing.

Background to and reasons for the Placing

As announced to the market on 17 November 2016, the Company is liaising with the relevant authorities in Egypt in an effort to secure the payment of the accrued revenues owed to the Company in respect of its 25 per cent. economic, non-operating, interest in the East Ghazalat concession ("East Ghazalat") held through the joint venture with Nostra Tera Oil and Gas plc. The effective date for that acquisition was 1 July 2015 and revenues have been accruing to the joint venture since that date. The timing of the payment of these accrued revenues is solely within the control of the Egyptian authorities (although a degree of co-operation from the Operator is required and in this respect the Company is working with the authorities) and the Company has yet to receive any cash revenue from East Ghazalat. The Company remains convinced that East Ghazalat remains an attractive asset if its costs are monitored and closely controlled and the necessary additional development of the field is undertaken. As announced on 25 January 2016 and disclosed in the Company's 2015 annual accounts, the Company's relationship with the operator of the East Ghazalat concession has been difficult. The Company is currently reviewing its options in relation to East Ghazalat to establish the course of action which represents the best value for the Company and its stakeholders.

The Company continues vigorously to pursue potential farm-in partners for its Ksar Hadada oil and gas field in Tunisia, where as previously announced it has obtained an extension to its exploration permit until 6 August 2017. It is engaging in commercial discussions with one specific party. The Company continues to monitor the progress and merits of its ongoing litigation in respect of its Italian gas storage assets.

As previously announced on 10 May, 17 May 2016 and 14 July 2016, the Company has made determined efforts to reduce ongoing cash costs and cash indebtedness by, amongst other things:

· securing agreements from certain trade creditors to accept ordinary shares in settlement of their debt (£42,817 of debt remains to be settled in shares at the date of this Announcement);

· reducing the Company's ongoing cash costs to c.£700,000 for the 12 months ending 1 May 2017 and a target monthly run rate of £50,000 thereafter, through, amongst other things, reducing staff costs and moving into smaller, less expensive, office accommodation.

· the directors and certain employees agreeing to accept remuneration due to them for the period to 30 June 2016 in ordinary shares the quantum being calculated using an average weighted subscription price of 0.224 pence per share;

· Further ongoing remuneration to be calculated by issuing shares using an issue price of 0.45 pence per share for the quarter ending 30 September 2016 and 0.60 pence per share for the quarter ending 31 December 2016. The various parties have also agreed to take restricted shares at the 0.60p price in lieu of remuneration for the year ended 31 December 2017;

· All bar one tranche of shares (issued to a specific director as announced on 14 July 2016) are subject in to restrictions on their vesting relating to continuing service with the Company and a minimum share price of 0.20p having been achieved after their issue

In addition, as announced on 28 September 2016, the Company was delighted to secure the early repayment of the US$2.5 million Loan Note issued to TransGlobe Petroleum International Inc. in respect of the acquisition of East Ghazalat through the two payments of US$100,000 one by it and the other by Nostra Terra Oil and Gas plc, its joint venture partner.

Cash raised from equity finance carries the advantage to the Company of not requiring to be repaid and thus can be deployed exclusively to reduce the Company's indebtedness and meet ongoing cash costs. The Company has sought to minimise the equity cash calls it has made on investors given their dilutive effect on future shareholder returns but having considered the current trading position and the likely timing of revenue receipts from East Ghazalat, the Board has concluded that it is in the best interests of the Company and its shareholders to raise further equity finance through the Placing allowing it to maintain its solvency, inter alia by managing its indebtedness and supporting its shorter term financing requirements.

This will enable the Company to continue to pursue its key objectives of realising value for all its stakeholders through securing ongoing operational revenues from its Egyptian and Tunisian assets and, in the longer term, securing and developing additional lower risk, producing or near producing oil and gas assets capable of delivering attractive returns to shareholders.

As at 30 November 2016, the Company had trade creditors who will require settlement in cash or shares of approximately £400,000 (unaudited), some of which is contingent, and £17,000 cash at bank (unaudited). There remains an undrawn amount of £240,000 on the Brandon Hill loan facility.

Use of proceeds

The Company intends to use the net proceeds of the Placing to manage its current creditor position and provide working capital to meet its short term financial needs.

Admission to trading

The Placing Shares will rank pari passu with the existing Ordinary Shares and application has been made for the Placing Shares to be admitted to trading on AIM ("Admission"). It is expected that Admission will become effective and dealings in the Placing Shares will commence at 8.00 a.m. on 9 December 2016.

CEO comment

Commenting on the Placing, Greg Coleman, CEO of Independent Resources said: "I would like to thank the providers of our additional equity finance and Brandon Hill for their continued support as the Company strives to achieve its near term objectives of securing revenues and shareholder returns from its current assets and, longer term, securing and developing further lower risk, producing assets capable of delivering attractive returns to our shareholders."

Related Party Transaction

The Placing was executed on the Company's behalf by Brandon Hill. Brandon Hill is regarded as a related party as defined by the AIM Rules for Companies due to its shareholding in the Company and its participation in the Placing and the connected commissions earned are therefore regarded as related party transactions for the purposes of the AIM Rules for Companies. The Board, having consulted with ZAI Corporate Finance Limited, the Company's Nominated Adviser, believes that the terms of these related party transactions are fair and reasonable insofar as the shareholders of the Company are concerned.

Total Voting Rights

In accordance with the Financial Conduct Authority's Disclosure and Transparency Rules, the Company confirms that following completion, of the Placing, including its maximum subscription, there will be 2,293,749,294 ordinary shares of 0.01p each in the Company in issue none of which are held in treasury. The total number of voting rights in the Company is 2,293,749,294.

The above figure of 2,293,749,294 may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA's Disclosure and Transparency Rules.

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

For more information, please visit www.ir-plc.com or contact: