EDR.L Regulatory News (EDR)

7 Dec 2005 07:01

Egdon Resources PLC07 December 2005 7 December 2005 For immediate release EGDON RESOURCES PLC Placing of Shares Egdon Resources Plc ("Egdon" or the "Company") is pleased to announce theplacing of 5,555,000 new ordinary shares of 1p each at 90p per share (the "Placing Shares") to raise £5 million before expenses (the "Placing"). ThePlacing Shares were placed by Seymour Pierce Limited with new and existinginstitutional investors and three of the Company's directors. Application hasbeen made for the Placing Shares to be admitted to AIM and admission of thePlacing Shares is expected to take place on 12 December. Following the Placing,the Company will have 57,149,974 ordinary shares in issue. The net proceeds of the Placing receivable by the Company, which are expected tobe £4.8 million, will provide equity capital for the Company to drill, and takecores from, the Portland-1 borehole to confirm the thickness and suitability ofthe salt sequence to create caverns to store natural gas. The funds will alsoensure that the Company has sufficient resources to analyse the cores and othergeological data from the borehole, and complete the Environmental ImpactAssessment which will accompany the project planning and pipeline constructionauthorisation applications. Additional funds have also been raised to acceleratedrilling activity on the next tranche of prospects after completion in Q2 2006of the multi-well programme currently underway. Non-Executive Directors Walter Roberts, Kenneth Ratcliff and John Rix subscribedfor 100,000, 4,000 and 100,000 Placing Shares respectively in the Placing.Messers Roberts, Ratcliff and Rix are now the beneficial owners of 1,026,750(1.80%), 39,000 (0.07%) and 1,226,333 (2.15%) ordinary shares respectively. Commenting on the Placing, Philip Stephens, Chairman of Egdon, said: "We are pleased to have raised funds to take the Portland Gas Storage Projectthrough the planning process. Rather than involving a partner, the Boardbelieves that securing additional equity funding at this stage will maximizelong-term shareholder value in the project. An acceleration of the explorationand appraisal programme in 2006 will allow Egdon to test a number of its higherpotential projects. These include the appraisal of the Grenade heavy oilaccumulation in France and exploration of the deeper Sherwood sandstone trend inits Wessex Basin portfolio". For further information please contact: Egdon Resources Plc 01256 702292Mark Abbott, Joint Managing DirectorAndrew Hindle, Joint Managing Director Buchanan Communications 020 7466 5000Eric BurnsBen Willey Notes to the Editors The gas storage project on the Isle of Portland is owned outright by Egdonthrough its wholly owned subsidiary, Portland Gas Limited. The Portland-1 gasstorage confirmation well will be drilled by Egdon from a site leased byPortland Gas Limited. Company Background Egdon is an established, UK-based energy company primarily focused on thehydrocarbon-producing basins of the onshore UK. Egdon also has explorationinterests in the offshore UK and France. Egdon was formed in 1997 by Dr Andrew Hindle and Mark Abbott. In December 2004,Egdon's shares commenced trading on AIM, having been previously traded on Ofexsince July 2000. The Company is developing two major business areas: an oil andgas exploration and production business, which has a portfolio of twentyexploration licences containing identified oil and gas prospects ranging fromdiscoveries under appraisal through to higher risk but higher reward "wild cat"exploration prospects; and a gas storage business initially focused on thedevelopment of a salt cavern gas storage facility on the Isle of Portland,Dorset. This information is provided by RNS The company news service from the London Stock Exchange