Falcon Oil & Gas Ltd. - Binding Letter of Intent Executed with
New Joint Venture Partner
Falcon Oil & Gas
Ltd.(“Falcon” or
“Company”)
Binding Letter of Intent
Executed with New Joint Venture
Partner
11 October 2022 – Falcon Oil & Gas Ltd.
(TSXV: FO, AIM: FOG) is pleased to announce that its c.98% owned
subsidiary, Falcon Oil & Gas Australia Limited (“Falcon
Australia”), has entered into a binding Letter of Intent
(“LOI”) with Tamboran (B1) Pty Limited
(“Tamboran”), a joint venture between Sheffield
Holdings LP and Tamboran Resources Limited, pursuant to which the
parties have agreed to amend the terms of the Joint Operating
Agreement (“JOA”) and the Farm-In Agreement
(“FIA”), each dated 2 May 2014 (as amended),
entered into with Origin Energy B2 Pty Ltd
(“Origin”) in respect of Falcon Australia’s
interest in the Beetaloo Sub-Basin exploration permits.
The Board believes that the proposed amendments
to the FIA and JOA will significantly improve Falcon’s future
capital preservation and optionality. The key terms of the LOI
provide for:
- Falcon Australia to earn an
additional carry on future well costs of up to AU$30m (AU$6.75m net
to Falcon Australia);
- the introduction of limited
proration units on sole risk operations to a maximum of 6,400 acres
per well, providing Falcon Australia with participation optionality
on the drilling of future wells;
- the sharing of well data on any
sole risked wells, providing Falcon Australia with visibility on
crucial data and analysis even where it elects not to participate;
and
- pre-emptive rights in relation to
Origin’s divestment of its 77.5% interest in the Beetaloo Sub-basin
announced on 19 September 2022 are not to be exercised by Falcon
Australia and all pre-emptive and similar rights are to be removed
from the JOA, providing Falcon Australia with greater flexibility
for realisation of licence interests.
The parties will now proceed to negotiate and
agree fully termed amendments to the JOA and the FIA reflecting the
terms of the LOI.
Drilling of the first of the two Stage 3 wells
will commence shortly with Falcon Australia still benefiting
financially from the remainder of the carry under the existing FIA
and JOA with Origin.
Philip O'Quigley,
Falcon’s CEO,
commented:
“Falcon Australia welcomes its new JV partners,
Sheffield Holdings and Tamboran Resources. While our immediate
focus is on the two Stage 3 Amungee wells, we are really excited
about the future pace of development of the Beetaloo. The proposed
amendments to the FIA and JOA puts Falcon in a very strong position
going forward creating optionality for our shareholders in terms of
the level of participation in any future appraisal and development
drilling. Each future well drilled in the Beetaloo basin play
further de-risks the play and, as a result of the proposed changes
contemplated by the LOI, Falcon can tailor its participation to
best preserve its capital while at the same time maximising its
optionality.”
Investor Meet
Q&AFalcon will provide a live Investor Q&A
with Philip O’Quigley via the Investor Meet Company platform
today, 11 October 2022 at 10:00am BST.
The presentation is open to all existing and potential
shareholders, and questions can be submitted at any time during the
live presentation.
Investors can sign up to Investor Meet Company for free and add
to meet Falcon Oil & Gas
Ltd. via:https://www.investormeetcompany.com/falcon-oil-gas-ltd/register-investor
Investors who already follow Falcon Oil & Gas
Ltd. on the Investor Meet Company platform will automatically
be invited.A recording of the presentation will be made available
on the Investor Meet Company platform and the Company’s website
later today.
This contains inside
information.
Ends.
CONTACT DETAILS:
Falcon Oil & Gas
Ltd. |
+353 1 676 8702 |
Philip O'Quigley, CEO |
+353 87 814 7042 |
Anne Flynn, CFO |
+353 1 676 9162 |
|
Cenkos Securities plc (NOMAD & Broker) |
|
Neil McDonald / Derrick Lee |
+44 131 220 9771 |
About Falcon Oil & Gas
Ltd.Falcon Oil & Gas Ltd is an international oil &
gas company engaged in the exploration and development of
unconventional oil and gas assets, with the current portfolio
focused in Australia, South Africa and Hungary. Falcon Oil &
Gas Ltd is incorporated in British Columbia, Canada and
headquartered in Dublin, Ireland with a technical team based in
Budapest, Hungary.
Falcon Oil & Gas Australia Limited is a c.
98% subsidiary of Falcon Oil & Gas Ltd.
For further information on Falcon Oil & Gas
Ltd. please visit www.falconoilandgas.com
About Tamboran (B1) Pty
LimitedTamboran (B1) Pty Limited is a 50:50 joint venture
between Tamboran Resources Limited and Sheffield Holdings, LP.
Tamboran Resources Limited, founded in 2009, is
a public natural gas company listed on the ASX (TBN) and OTC
markets (TBNNY). It has a vision of supporting the net zero CO2
energy transition in Australia and Asia-Pacific through developing
low CO2 unconventional gas resources in the Northern Territory of
Australia. It is headquartered in Sydney, Australia with a global
management team leveraging a significant depth of experience in the
successful commercialisation of unconventional gas throughout North
America. The team brings a wealth of knowledge, including modern
shale reservoir assessment, as well as cutting-edge drilling and
completion design technology.
Bryan Sheffield of Sheffield Holdings LP is a
highly successful investor and has made significant returns in the
US unconventional energy sector in the past. He was Founder of
Parsley Energy Inc. (“PE”), an independent
unconventional oil and gas producer in the Permian Basin, Texas and
previously served as its Chairman and CEO. PE was acquired for over
US$7 billion by Pioneer Natural Resources Company
(“Pioneer”), itself a leading independent oil and
gas company and with the PE acquisition became a Permian pure play
company. Pioneer has a current market capitalisation of c. US$60
billion.
Glossary of terms
A$ |
Australian Dollar |
FIA |
Farmin agreement dated 2 May 2014 as amended from time to time |
JOA |
Joint Operating Agreement dated 2 May 2014 as amended from time to
time |
Proration unit |
Acreage assigned to the area around a well where sole risk
operations take place |
Sole
risk operations |
An operation carried out by fewer than all parties to the joint
venture |
|
|
Advisory regarding forward looking
statementsCertain information in this press release may
constitute forward-looking information. Any statements that are
contained in this news release that are not statements of
historical fact may be deemed to be forward-looking information.
Forward-looking information typically contains statements with
words such as “may”, “will”, “should”, “expect”, “intend”, “plan”,
“anticipate”, “believe”, “estimate”, “projects”, “dependent”,
“potential”, “scheduled”, “forecast”, “outlook”, “budget”, “hope”,
“suggest”, “support” “planned”, “potential” or the negative of
those terms or similar words suggesting future outcomes. In
particular, forward-looking information in this press release
includes, but is not limited to, information relating to the letter
of intent executed, proposed amendments to the JOA and FIA, limited
proration units on sole risk operations providing future
participation optionality and future sole risk operations and
information relating to the Company’s drilling program. This
information is based on current expectations that are subject to
significant risks and uncertainties that are difficult to predict.
The risks, assumptions and other factors that could influence
actual results include risks associated with fluctuations in market
prices for shale gas; risks related to the exploration, development
and production of shale gas reserves; general economic, market and
business conditions; substantial capital requirements;
uncertainties inherent in estimating quantities of reserves and
resources; extent of, and cost of compliance with, government laws
and regulations and the effect of changes in such laws and
regulations; the need to obtain regulatory approvals before
development commences; environmental risks and hazards and the cost
of compliance with environmental regulations; aboriginal claims;
inherent risks and hazards with operations such as mechanical or
pipe failure, cratering and other dangerous conditions; potential
cost overruns, drilling wells is speculative, often involving
significant costs that may be more than estimated and may not
result in any discoveries; variations in foreign exchange rates;
competition for capital, equipment, new leases, pipeline capacity
and skilled personnel; the failure of the holder of licenses,
leases and permits to meet requirements of such; changes in royalty
regimes; failure to accurately estimate abandonment and reclamation
costs; inaccurate estimates and assumptions by management and their
joint venture partners; effectiveness of internal controls; the
potential lack of available drilling equipment; failure to obtain
or keep key personnel; title deficiencies; geo-political risks; and
risk of litigation.
Readers are cautioned that the foregoing list of
important factors is not exhaustive and that these factors and
risks are difficult to predict. Actual results might differ
materially from results suggested in any forward-looking
statements. Falcon assumes no obligation to update the
forward-looking statements, or to update the reasons why actual
results could differ from those reflected in the forward
looking-statements unless and until required by securities laws
applicable to Falcon. Additional information identifying risks and
uncertainties is contained in Falcon’s filings with the Canadian
securities regulators, which filings are available at
www.sedar.com, including under "Risk Factors" in the Annual
Information Form.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
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