Nostra Terra Regulatory News (NTOG)

AIM: NTOG

23 October 2012

Nostra Terra Oil and Gas Company plc

("Nostra Terra" or the "Company")

Amendment to Yorkville Agreements & Operations Update

Yorkville Arrangements

Nostra Terra, an AIM listed oil and gas producer with assets in the USA, has agreed to amend its standby equity distribution agreement (the "SEDA") with YA Global Master SPV Ltd ("Yorkville"), so that individual advances under the SEDA may be aggregated in order to streamline the process of raising funds.

In connection with the amendment of the SEDA, Nostra Terra's Chief Executive Officer, Matt Lofgran and Yorkville have agreed to modify the arrangements relating to the secured loan note (announced on 29 June 2012) such that 155,000,000 of the 289,842,506 ordinary shares previously secured by a fixed charge shall now be loaned ("Loan Shares") to Yorkville in order to allow more flexibility for the SEDA. The Loan Shares have been released from the fixed charge and transferred to Yorkville with immediate effect. Yorkville may only sell the Loan Shares following a request by Nostra Terra under the terms of the SEDA. The Loan Shares will be redelivered by Yorkville to Mr Lofgran at the end of the Lending Agreement arrangement.

As a result of the arrangement, Mr Lofgran's interest in the Loan Shares is now held by Yorkville, representing 6.31% of the Company's share capital. Mr Lofgran retains a holding of 141,842,506 ordinary shares in the capital of the Company, representing 5.77% of the Company's issued capital.

Chisholm Trail Prospect

Nostra Terra is also pleased to update on the progress at the Chisholm Trail Prospect. Drilling has now finished on both the first and second wells on the prospect, (where the Company has a 0.47% working interest ("WI") and a 0.16% WI respectively). The fractured stimulation and completions for both wells are scheduled to take place within the coming weeks. This procedure takes place after drilling and logging have been completed and the drilling rig has been moved away.

In addition to these wells, Nostra Terra owns a 20% interest in the overall Chisholm Trail Prospect, with varying WIs in each well, and further leases being taken. Two further wells are planned to be drilled during the remainder of 2012, with additional wells already being planned for early 2013 and beyond.

Matt Lofgran, Chief Executive Officer of Nostra Terra, commented:

"The changes in the SEDA better suit our leasing and acquisition program where we're generating our own prospects with multi-pay and multi-well potential using 3D seismic to reduce risk. This amendment will be particularly efficient when using the facility for paying large numbers of small leasing agreements such as is typical in the oil industry in the USA."

"We are also pleased with the pace of development on the Chisholm Trail Prospect. The activity level is increasing in and around this highly productive project and we are delighted to have acquired a meaningful interest with an early-mover advantage in the development of this greater play."

For further information, visit www.ntog.co.uk or contact:

Nostra Terra Oil and Gas Company plc

Matt Lofgran, CEO

mlofgran@ntog.co.uk Telephone: +1 480 993 8933

Shore Capital & Corporate Limited (Nominated Adviser) 

Bidhi Bhoma/ Toby Gibbs Telephone: +44 (0)20 7408 4090

Alexander David Securities Ltd

David Scott / Bill Sharp Telephone: +44 (0)20 7448 9800

Lothbury Financial Services Limited

Gary Middleton / Michael Padley Telephone: +44 (0)20 7868 2010

Notes:

In September 2012, Nostra Terra entered into an agreement with Ward Petroleum for the Chisholm Trail Prospect, a multi-well horizontal drilling project in Oklahoma. The prospect area is large in size and a leasing program is on-going. Nearby drilling has resulted in several wells that produce in excess of 200boepd after the first 30 days of "flush" production. Nostra Terra owns a 20% interest in this active program within which working interests in the individual wells vary. Based on results from neighbouring wells, we anticipate this prospect also has the potential to deliver rapid payouts with continued strong production levels.

Ward Petroleum Corporation, based in Enid Oklahoma, was founded in 1963 by Lew Ward, its Chairman. Mr. Ward is a past-President of the Independent Producers Association of America (IPAA) and is a respected member of the oil producers' community of the United States. Among its industry honours, Ward Petroleum has been listed in the top 100 fastest growing American companies by Inc. magazine, and has been named a "Blue Chip Enterprise" by Nations Business magazine. Since its founding, Ward Petroleum has drilled more than 800 wells in the Anadarko and Arkoma Basins, some as deep as 22,000 feet. Ward Petroleum operates nearly 350 wells in Oklahoma throughout both basins.

Oklahoma is the fifth largest producing state in the United States in crude oil production. Despite its long history, it still produces about one quarter of the peak rate that was reached in 1927. The state was the birthplace for such commonly recognized corporate names as Halliburton, ConocoPhillips and J. Paul Getty.