8 Sep 2017 07:00
REGENCY MINES PLC
("Regency" or the "Company")
Partial repayment of Convertible Loan
Environment Agency Approval and Council Planning Application at Horse Hill Licences, Weald Basin, SE UK
8 September 2017
The Company is pleased to report that it has today prepaid in cash US$350,000 of the one year convertible loan for $1,000,000 ($900,000 net of fees) from a consortium led by YA II PN, Ltd announced on 5 April 2017.
The Company also announces that the Environment Agency has granted the necessary permits to Horse Hill Developments Limited ("HHDL"), the operator of Horse Hill licences PEDL 137 and PEDL 246, to enable HHDL to carry out extended well tests, drill a side-track from the existing HH-1 well and drill and test a new borehole HH-2. As previously advised, a planning application in relation to these proposed activities has also been submitted to Surrey County Council (the "Council"). We have been informed by HHDL that the Council has confirmed that the planning application is now scheduled to be determined at October's meeting of its planning committee. Members of the planning committee completed a scheduled visit to the Horse Hill site yesterday, 7 September, in preparation for the October meeting
Regency Chairman Andrew Bell commented: "We are pleased to have prepaid a substantial part of the convertible loan taken out in April this year. We recognised the fears of some investors that this loan might lead to share issues to the lender that might negatively affect our share price, and hope that this repayment demonstrates the firm intention of the Company that this should not occur.
2017 is the year that oil exploration in the Weald Basin is coming of age: besides the planned extended well test work at Horse Hill, flow test work is already under way at Broadford Bridge, and the operator has applied to carry out further work leading to production from the nearby Brockham field. This further progress in the permitting at Horse Hill is a positive development and we look forward to seeing work under way later this year."
HH-1 Oil Discovery and Regency Interest
The HH-1 Kimmeridge Limestone and Portland oil discovery well is located within onshore exploration Licence PEDL137, on the northern side of the Weald Basin, 3 km north of Gatwick Airport. As previously reported in February and March 2016, two naturally-fractured limestone members within the Kimmeridge section, known as KL3 and KL4, flowed dry, 40-degree API oil, at an aggregate stabilised natural flow rate of 1,365 barrels of oil per day ("bopd") with no clear indication of depletion. The overlying Portland flowed dry, 35-37 API gravity crude at a stable pumped rate of 323 bopd. The Portland was produced at the rod-pump's maximum achievable rate and thus flow was constrained by the pump's mechanical capacity.
As previously reported on 4 April 2017, the application for long term production testing and further appraisal drilling was submitted to Surrey County Council in October 2016, and is now scheduled to be decided at the Council's planning committee meeting in October 2017 (as detailed above).
Regency owns 3.1% of HHDL, the 65% owner of the Horse Hill licenses, and owns 0.19% of UK Oil & Gas Investments PLC, which owns 49.9% of HHDL and 100% of the Broadford Bridge License PEDL 234.
Glossary:
degree API | a measure of the density of crude oil, as defined by the American Petroleum Institute |
discovery | a discovery is a petroleum accumulation for which one or several exploratory wells have established through testing, sampling and/or logging the existence of a significant quantity of potentially moveable hydrocarbons |
flow test | a flow test or well test involves testing a well by flowing hydrocarbons to surface, typically through a test separator. Key measured parameters are oil and gas flow rates, downhole pressure and surface pressure. The overall objective is to identify the well's capacity to produce hydrocarbons at a commercial flow rate |
limestone | a sedimentary rock predominantly composed of calcite (a crystalline mineral form of calcium carbonate) of organic, chemical or detrital origin. Minor amounts of dolomite, chert and clay are common in limestones. Chalk is a form of fine-grained limestone |
step-out | a well designed to determine the lateral extent of a discovered hydrocarbon accumulation or play |
For further information, please contact:
Andrew Bell 0207 747 9960 Chairman Regency Mines Plc
Scott Kaintz 0207 747 9960 Executive Director Regency Mines Plc
Roland Cornish/Rosalind Hill Abrahams 0207 628 3396 NOMAD Beaumont Cornish Limited
Neil Badger 0129 351 7744 Broker Dowgate Capital Stockbrokers Ltd.