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Pin to quick picksZephyr Energy Regulatory News (ZPHR)

Share Price Information for Zephyr Energy (ZPHR)

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Debt for equity exchange & State 36-2R well update

3 May 2024 07:00

RNS Number : 0934N
Zephyr Energy PLC
03 May 2024
 

Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the UK Market Abuse Regulation. With the publication of this announcement, this information is now considered to be in the public domain.

 

3 May 2024

Zephyr Energy plc

("Zephyr" or the "Company")

 

Debt for equity exchange and

State 36-2R well drilling update

 

Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF), the Rocky Mountain oil and gas company focused on responsible resource development from carbon-neutral operations, announces that the Company has retired US$3.88 million (£3.11 million) of existing debt ("Repayment Amount") through the issuance of US$3.88 million (£3.11 million) of equity comprised of 64,045,768 new ordinary shares of 0.1 pence ("p") each in the Company ("Repayment Shares"), at a price of 4.85p per Repayment Share (the "Issue Price").

 

The Issue Price of the Repayment Shares is the undiscounted mid-market closing price of the Company's shares on 2 May 2024.

 

The Repayment Shares are being issued to SGR Investments, LLC ("SGRI"), a US-based institutional investor with a 50-year investment track record. In December 2022, SGRI provided debt funding (the "SGRI loan note") to Zephyr Williston LLC, a subsidiary of the Company, to enable Zephyr's group to acquire a portfolio of Williston Basin wells operated by Slawson Exploration. The obligation to repay the Repayment Amount was novated to the Company prior to the allotment of the Repayment Shares.

 

The Repayment Shares are being issued using existing share authorities granted to the Board at the Company's annual general meeting held on 26 July 2023.

 

The residual portion of the SGRI loan note is in the process of being refinanced through the Company's existing commercial banking facilities as part of its regularly scheduled semi-annual redetermination process which is expected to be concluded in May 2024. Post-redetermination, Zephyr's forecast gross debt is expected to be circa US$30 million.

 

The Repayment Shares represent approximately 3.7 per cent of the enlarged share capital of the Company as enlarged by the issue of the Repayment Shares and will rank pari passu with the existing ordinary shares of 0.1 p each in the Company ("Ordinary Shares"). Accordingly, from Admission (as defined below), SGRI will be a shareholder of approximately 3.7 per cent of the Company's shares.

 

Application will be made to London Stock Exchange plc for the Repayment Shares to be admitted to trading on AIM ("Admission"). It is anticipated that Admission will become effective at 8.00 a.m. on or around 9 May 2024.

 

On Admission, the Company will have 1,750,547,591 Ordinary Shares in issue, each with one voting right. There are no shares held in treasury. Therefore, the Company's total number of Ordinary Shares in issue and voting rights will be 1,750,547,591 and this figure may be used by shareholders from Admission as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the FCA's Disclosure Guidance and Transparency Rules.

 

State 36-2R well update

 

Following its announcement on 25 April 2024 that the State 36-2 LNW-CC-R well (the "State 36-2R well") had spud, the Company is pleased to report that operations are progressing as expected. On 26 April, the 17-½ inch surface section of the well was completed at a total depth at 1,570 feet, at which point casing was set and cemented prior to the installation of the blowout preventor. Drilling operations have since commenced on the 12-¼ inch intermediate section, with a current hole depth of 3,238 feet. Drilling is planned to a total depth of 10,362 feet measured depth (9,600 feet true vertical depth) and will incorporate a short, 270-foot horizontal reservoir section.

 

 

Colin Harrington, Chief Executive of Zephyr, said:

"We continue to make good progress on the drilling of the State 36-2R well and remain on track to complete the well within our forecast thirty-day period."

 

"In the meantime, the debt for equity exchange will further strengthen our balance sheet, with no ancillary fees and at no discount to the current market price, while increasing future cash flows for reinvestment into our growing asset portfolio. I'm thrilled to welcome SGRI as a cornerstone equity investor as we work to deliver the next phase of Zephyr's growth."

 

 

Contacts:

Zephyr Energy plc

Colin Harrington (CEO)

Chris Eadie (Group Finance Director)

 

 Tel: +44 (0)20 7225 4590

Allenby Capital Limited - AIM Nominated Adviser

Jeremy Porter / Vivek Bhardwaj

 

 Tel: +44 (0)20 3328 5656

 

Turner Pope Investments - Joint-Broker

James Pope / Andy Thacker 

 

Panmure Gordon (UK) Limited - Joint-Broker

Hugh Rich / James Sinclair-Ford

 

Celicourt Communications - PR

Mark Antelme / Felicity Winkles / Ali AlQahtani

 Tel: +44 (0)20 3657 0050

 

 

Tel: +44 (0) 20 7886 2500

 

 

 

Tel: +44 (0) 20 8434 2643

 Notes to Editors

Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF) is a technology-led oil and gas company focused on responsible resource development from carbon-neutral operations in the Rocky Mountain region of the United States. The Company's mission is rooted in two core values: to be responsible stewards of its investors' capital, and to be responsible stewards of the environment in which it works.

Zephyr's flagship asset is an operated 46,000-acre leaseholding located in the Paradox Basin, Utah, 25,000 acres of which has been assessed to hold, net to Zephyr, 2P reserves of 2.6 million barrels of oil equivalent ("mmboe"), 2C resources of 34 mmboe and 2U resources 270 mmboe.

In addition to its operated assets, the Company owns working interests in a broad portfolio of non-operated producing wells across the Williston Basin in North Dakota and Montana. Cash flow from the Williston production will be used to fund the planned Paradox Basin development. In addition, the Board will consider further opportunistic value-accretive acquisitions. 

Certain statements in this announcement, are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as ''believe'', ''could'', "should" ''envisage'', ''estimate'', ''intend'', ''may'', ''plan'', ''potentially'', "expect", ''will'' or the negative of those, variations or comparable expressions, including references to assumptions. These forward looking statements are not based on historical facts but rather on the Directors' current expectations and assumptions regarding the Company's future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such forward looking statements reflect the Directors' current beliefs and assumptions and are based on information currently available to the Directors.

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
 
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UPDMZGGKZZFGDZZ
Date   Source Headline
26th Sep 20247:00 amRNSHalf-year Report
17th Sep 20247:00 amRNSResponse to market speculation
6th Sep 20247:00 amRNSSuccessful State 36-2R well production test result
29th Aug 20247:00 amRNSUpdate on helium project & State 36-2R well test
14th Aug 20247:00 amRNSQ2 2024 results from the Williston Basin portfolio
31st Jul 202411:48 amRNSResult of AGM
31st Jul 20247:00 amRNSAGM Statement and Salt Wash helium project update
23rd Jul 20247:00 amRNSInitial results from State 36-2R production test
9th Jul 20247:00 amRNSOperations Update
27th Jun 20247:00 amRNSFinal Results
26th Jun 20247:00 amRNSOperations Update
14th Jun 20247:00 amRNSState 36-2R well production test
6th Jun 20247:00 amRNSState 36-2R well update
3rd Jun 20247:00 amRNSState 36-2R well drilling update
31st May 20245:00 pmRNSTotal Voting Rights
31st May 20247:00 amRNSQ1 2024 results from the Williston Basin portfolio
29th May 20247:01 amRNSGrant funding from U.S. DOE & drilling update
14th May 20247:00 amRNSOperations update, warrant exercise and TVR change
3rd May 20247:00 amRNSHolding(s) in Company
3rd May 20247:00 amRNSDebt for equity exchange & State 36-2R well update
25th Apr 20247:00 amRNSStart of well drilling operations
17th Apr 20247:00 amRNSState 36-2R well drilling operations update
10th Apr 20247:00 amRNSGrant of share options and issue of warrants
28th Mar 20247:00 amRNSAdditions to senior management team
27th Mar 20241:02 pmRNSSalt Wash helium project update - replacement
27th Mar 20247:00 amRNSSalt Wash helium project update
22nd Mar 20247:00 amRNSCommencement of Initial Drilling Operations
15th Mar 20247:00 amRNSAward of rig contract to Helmerich & Payne
11th Mar 20247:00 amRNSParadox project update
29th Feb 20247:00 amRNSQ4 2023 results from Williston Basin portfolio
14th Feb 20247:00 amRNSState 36-2R Drilling Permit Sundry Notice Approval
8th Feb 20247:00 amRNSOperations update
15th Dec 20237:00 amRNSOperational update
15th Nov 20237:00 amRNSQ3 2023 results from Williston Basin portfolio
1st Nov 20237:00 amRNSWilliston Basin Update
25th Oct 20237:00 amRNSInvestor Webinar Registration
18th Oct 202312:38 pmRNSInvestor Webinar
18th Oct 20237:00 amRNSParadox project update
29th Sep 20237:00 amRNSHalf-year Report
20th Sep 20237:00 amRNSStatement Re Market Speculation
15th Aug 20237:00 amRNSQ2 Williston Basin & State 36-2 LNW-CC Update
26th Jul 202311:39 amRNSResult of AGM
26th Jul 20237:00 amRNSAGM Statement
10th Jul 20237:00 amRNSParadox project update
30th Jun 20235:00 pmRNSTotal Voting Rights
26th Jun 20237:00 amRNSFinal Results
6th Jun 20237:00 amRNSPlacing & Subscription & Project Update
16th May 20237:00 amRNSQ1 Williston Basin & State 36-2 LNW-CC Update
2nd May 20237:00 amRNSHedging programme update
20th Apr 20236:15 pmRNSCorporate Presentation

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