Tomco Energy Regulatory News (TOM)

16 November 2021

TOMCO ENERGY PLC

("TomCo" or the "Company")

Acquisition of an initial 10% interest in TSHII and Loan Agreement

TomCo Energy plc (AIM: TOM), the US operating oil development group focused on using innovative technology to unlock unconventional hydrocarbon resources, is pleased to provide a further update with respect to the Company's 100% owned subsidiary, Greenfield Energy LLC's ("Greenfield"), potential acquisition of up to 100% of the ownership and membership rights and interests in Tar Sands Holdings II LLC ("TSHII") (the "Membership Interests"), as announced on 9 June 2021 (the "Agreement").

The Company is pleased to announce that Greenfield has now exercised its option to acquire an initial 10% of the Membership Interests for a total cash consideration of US$2 million, of which an amount of US$500,000 was satisfied by crediting the deposits paid previously. Accordingly, Greenfield now retains an exclusive option, at its sole discretion, to acquire the remaining 90% of the Membership Interests for additional cash consideration up to 31 December 2022, as detailed in the Company's announcement of 9 June 2021.

Alongside the acquisition of the initial 10% of the Membership Interests, a newly incorporated subsidiary of Greenfield has been granted a lease over approximately 320 acres of the 760 acre site owned by TSHII (the "Lease Area"), for a nominal consideration and annual rental of US$320, together with a 12% of net sales royalty per barrel of conventional oil, gas or sulphur produced and removed from the Lease Area.

The lease provides Greenfield's subsidiary with the exclusive right to explore, drill, and mine for, and extract, store, and remove oil, gas, hydrocarbons, and other associated substances on and from the Lease Area, together, inter alia, with the right to erect, construct and use such plant and equipment and infrastructure as required. The lease is for an initial term of 10 years and will continue thereafter for so long as any oil, gas or other hydrocarbons are being produced from the Lease Area or drilling operations are being prosecuted or as the parties may agree.

Loan Agreement

The US$1.5 million balance of the consideration paid to secure the acquisition of the initial 10% of the Membership Interests has been financed by way of an unsecured US$1.5 million loan from Valkor Oil & Gas LLC ("Valkor") to Greenfield (the "Loan").

The Loan is repayable by Greenfield through a number of potential options, or combination of such options, at its sole election, such combination adding up to the US$1.5 million principal amount of the Loan, plus any applicable interest or fees incurred. The repayment options include granting a share of potential net production revenues to initially offset the principal amount and for a period of five years thereafter from any oil well(s) planned to be drilled on the Lease Area, but for which the requisite further funding and permits have not yet been secured; and/or straight repayment of the principal amount plus interest and fees amounting to 15% of the principal amount of the loan, payable on the maturity date. In any event, a minimum of US$1.5 million must be repaid on or before 30 May 2022. To the extent that any part of the principal amount has not been paid by the scheduled maturity date (which may be extended by mutual agreement of the parties) then interest of 2% per month shall be applied to such unpaid amount from time to time until it has been repaid in full.

Greenfield is engaged in ongoing discussions regarding funding options to potentially achieve the ultimate acquisition of 100% of the Membership Interests, together with the drilling of a number of production oil wells and the planned first 5,000 barrels of oil per day production plant, whilst progressing other preparatory work. However, there can be no certainty that Greenfield can secure the requisite funding or the permitting required.

Further announcements will be made as and when appropriate.

Related Party Transaction

As a former JV partner, Valkor is considered to be a related party of the Company (as defined in the AIM Rules for Companies) and, accordingly, the Loan constitutes a related party transaction pursuant to AIM Rule 13. The TomCo directors, having consulted with Strand Hanson Limited, the Company's Nominated Adviser, consider that the terms of the Loan are fair and reasonable insofar as the Company's shareholders are concerned.

Commenting, John Potter, CEO of TomCo, said: "We are delighted to have completed this purchase of an initial 10% stake in TSHII. The acquisition provides Greenfield with a base from which to accelerate its plans to pursue both the drilling of certain near term oil production wells and thereafter the acquisition of the balancing 90% of the Membership Interests and its first commercial scale plant, subject to funding. We expect the permitting process for the production wells to be completed in Q1 2022, following the drilling of three exploration wells intended to occur in December 2021.

"Greenfield is currently focused on commercial negotiations with third parties in order to seek to secure the funding for its future plans, together with progressing the required permitting and other preparatory work. We look forward to providing further updates in due course."

Enquiries:

TomCo Energy plc

Malcolm Groat (Chairman) / John Potter (CEO) +44 (0)20 3823 3635

Strand Hanson Limited (Nominated Adviser)

James Harris / Matthew Chandler +44 (0)20 7409 3494

Novum Securities Limited (Broker)

Jon Belliss / Colin Rowbury +44 (0)20 7399 9402

IFC Advisory Limited (Financial PR)

Tim Metcalfe / Florence Chandler +44 (0)20 3934 6630

For further information, please visit www.tomcoenergy.com.

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018.