Corporate and Operational Update

RNS Number : 6658S

Molecular Energies PLC

13 March 2023

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATION (EU NO. 596/2014) AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("MAR").

13 March 2023

MOLECULAR ENERGIES PLC

("MEN" or the "Company")

Corporate and Operational Update

Molecular Energies PLC (AIM: MEN), the international energy Company with both hydrocarbon, and alternative energy divisions provides a corporate and operational update.

Highlights

· 2022 Argentine Financial Statements show profit before tax* in excess of US$19 million

· 19 MMboe Independently assessed net 2P Hydrocarbon Reserves for Argentina as at 31 December 2022

· Jordan Coleman named CEO (non board) of the Company's Hydrocarbon division

· Discussions on the IYA related party debt advancing centered on reducing interest rate on all outstanding monies to zero, extending the maturity period and debt reduction

· Green House joint venture Dual Fuel orders first equipment to progress development work on first engine

· Green House, new 100% owned subsidiary HYSO Limited, working on innovative methods for hydrogen refueling systems for heavy goods vehicles without expensive refueling apparatus

· Green House has formed ATON 6 PLC a 100% owned carbon focused company to capitalize on the Company's businesses, contacts and experience in relevant carbon related sectors

· Paraguay exploration well remains on track to spud in May

Argentina 2022 Financial Statements

The auditor reviewed Financial Statements for the full year 2022 of the Company's Argentine subsidiary, President Petroleum S.A ("PPSA") have been filed with the relevant authorities in Argentina.

The manner of determination of such Financial Statements is as referred to in the Company's 14 November 2022 announcement of the Q3 Financial Statements.

The Financial Statements, impacted by the material disruption of the facilities due to an incident there in H2 2022, include turnover in excess of US$34 million** and profit before tax* in excess of US$19 million both converted from Argentine Peso and inflation adjusted.

Independently assessed Hydrocarbon Reserves as at 31 December 2022

Molecular Energies PLC (AIM: MEN), the international energy company , provides an update on its Hydrocarbon Reserves in Argentina as at 31 December 2022 ("the Reserves").

Molecular Energies net Hydrocarbon Reserves in Argentina as at 31 December 2022 has now been independently assessed after taking into account: production in 2022 and the length of time remaining on the respective concessions (Rio Negro to 2027/8 and Salta to 2050).

The Reserves that are being filed with the relevant authorities in accordance with Argentine regulations are as follows:

	YE2022 Reserves (MMboe)			YE2021 Reserves (MMboe)
	1P	2P	3P	1P	2P	3P
Total Argentina	9.5	18.9	26.4	13.5	24.4	34.7

The above figures exclude all hydrocarbon resources (not reserves) including its exploration prospect at the Martinez del Tineo field, Salta Province, which is intended to be drilled in the latter part of H2 2023. The reserves are predominantly oil.

Jordan Coleman

The Company is pleased to announce that Jordan Coleman (aged 39) has been appointed Chief Executive (non board) of Molecular's Hydrocarbon Division with immediate effect.

Jordan has been with Molecular for 10 years having joined as a junior field manager progressing through to his more recent role of COO LatAm. He has demonstrated pragmatic thinking, focus, loyalty, adaptability, and a determination to succeed.

IYA related party debt ("IYA Debt")

The Company continues in negotiations with regard to the current level of interest payable by the Group to IYA, a Company ultimately beneficially owned by Peter Levine, the Company's Chairman and largest shareholder. The independent directors' objective is centered on reducing the interest rate applicable on all current outstanding monies to effectively zero, extending the term of maturity and reducing the debt level.

While there can be no guarantee that the current subject to contract negotiations currently underway with IYA will be satisfactory concluded, the independent directors of the Company are optimistic that a way forward can be found to achieve their objectives. It is now expected that a further update will be given during April.

Green House Capital ("GHC")

The alternative energies division of Molecular has been making active progress recently:

· Its joint venture Dual Fuel has made its first order of equipment to progress its development work on conversion of a diesel truck engine to run on a mix of hydrogen and diesel. Discussions in Paraguay with heavy goods vehicle users have progressed with two fleet users having already volunteered to have a test conversion using a hydrogen/diesel mix of fuel.

· GHC has incorporated HYSO Limited, a 100% owned subsidiary which is now working on an innovative method for refueling heavy goods vehicles without expensive refueling apparatus.

· ATON 6 PLC (from the Atomic number six being carbon), has been formed as a 100% subsidiary of GHC with the decision made to go straight to PLC status. The nature of ATON 6's business is to capitalise on its management and associated parties' experience and contacts in the sphere of carbon investments.

· The lithium potential in the north of Argentina is still being assessed and there are no further developments in this regard.

Paraguay

The exploration well in the Chaco, Paraguay remains on track to spud in May this year in accordance with the latest published expectations. The first personnel are already in the field with the well design settled and the drilling well on paper exercise (DWOP) with all contractors scheduled for 18 April 2023. All relevant permissions have been obtained.

Peter Levine, Chairman, commented:

"With the handing over the executive responsibility in the Hydrocarbon division to my experienced colleague Jordan Coleman, my attention in Molecular turns to develop our Green House Capital division.

"In relation to Green House, as was seen previously with ATOME and now with Dual Fuel, HYSO and ATON 6, each step capitalizes on and uses as a steppingstone some part of the core assets or experience of Molecular as a whole and each introduced into the group to take them to an ultimately independent level in the fullness of time.

"These are early days so step by step, but the direction of travel is clear".

Glossary:

*Converted from Argentine peso inflation adjusted and means, in the context of the report alone, profit after interest, income and forex operations but before tax, depreciation and amortization

**Converted from Argentine peso inflation adjusted

1P means proven reserves

2P means proven and probable reserves

3P means proven, probable and possible reserves

MMboe means million barrels of oil and oil equivalent (gas)

For further information please visit www.molecularenergiesplc.com or contact:

Molecular Energies PLC	[phone]
Nikita Levine, Investor Relations	[e-mail]
finnCap (Nominated Advisor and broker) Christopher Raggett, George Dollemore	[phone]
Tavistock (Financial PR & IR) Simon Hudson, Nick Elwes, Charles Baister	[phone]

Notes to Editors

Molecular Energies PLC is an AIM listed company at the forefront of energy development and has interests across the energy spectrum, from oil and gas projects to subdivisions in the green and alternative energy sub-sectors.

The Company has oil and gas production in two geographical markets: Argentina and the United States, as well as exploration assets in both Argentina and Paraguay. The Company also has two separate subdivisions which are focused on early-stage opportunities in the green and/or alternative energy sub- sector.

Activities in the green and alternative energy space are being carried out under the Green House Capital brand and through AIM listed ATOME Energy PLC operating in Paraguay, Costa Rica and Iceland, producing green hydrogen and ammonia for use in fuels.

With a strong strategic and institutional base of support, an in-country management team as well as the Chairman whose interests as the largest shareholder are aligned to those of its shareholders, Molecular gives UK investors access to an energy growth story combined with world class standards of corporate governance, environmental and social responsibility.

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018 ("UK MAR"). The person who arranged for the release of this announcement on behalf of the Company was Peter Levine, Chairman.

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