Tunisia Update

RNS Number : 9847G

Pennpetro Energy PLC

21 November 2022

 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, OR JAPAN

This announcement is not an offer for sale, or a solicitation of an offer to acquire, securities in any jurisdiction, including in or into the United States, Canada, Australia, or Japan. Neither this announcement nor any part of it shall form the basis of or be relied on in connection with or act as an inducement to enter into any contract or commitment whatsoever.

Pennpetro Energy PLC

("Pennpetro", the "Company" or the "Group")

Tunisia Update

London, 21 November 2022 - Pennpetro Energy PLC ("Pennpetro"), an independent oil and gas company focusing on production in the Gonzales Oil Field in Texas, USA, notes the RNS announcement issued on 18 November by Upland Resource PLC's ("Upland") stating the termination of the farm-in agreement into Upland's Saouaf permit area in Tunisia ("Saouaf Permit"). The Saouaf Permit is held in joint venture with the Tunisian state oil company, Enterprise Tunisienne d'Activités Pétroliéres ("ETAP").

As outlined in the announcement by Upland of 15 September 2022, a final deadline of 5 November 2022 had been set by way of a Formal Notice dated 5 September 2022 received from the Ministry of Industry Mines and Energy of Tunisia. The Notice requested the replacement by Upland of an expired bank guarantee of US$1M on or before 5 November 2022. Under the terms of the Farm Out Agreement (FOA) with Pennpetro, announced on 21 July 2022, Pennpetro is responsible for meeting the financial obligations associated with the license extension conditional upon both Pennpetro and the Tunisian authorities being satisfied with the result.

Since the announcement issued on 21 July 2022, the Board of Pennpetro has been awaiting confirmation from its Upland counterparts that the expired bank guarantee has been replaced, enabling Pennpetro to move forward with its plans for the near-term development of the Saouaf Permit. However, the Pennpetro Board received neither confirmation that the bank guarantee had been replaced by the Upland Board or confirmation that the deadline had not been met by Upland. The implications of this failure to replace the expired bank guarantee by Upland on Pennpetro's proposed farm-in was also not disclosed.

Andy Clifford, President of Pennpetro's wholly owned subsidiary, Nobel Petroleum USA Inc. ("Nobel"), commented:

"Despite this temporary setback, we remain committed to growing our business in Tunisia. Nobel views the available opportunities in Tunisia as complementary and synergistic to our Texas Gulf Coast developments and maintain an interest in the Saouaf Permit should it become available again in the near future. Not only are we looking at reservoirs with the same lithology as the Austin Chalk but also of the same geologic age. Furthermore, the application of leading-edge technology with respect to the Tunisian play is even further behind the Texas Gulf Coast.

While the major oil companies long ago left the Gulf Coast conventional plays to focus on unconventional targets, many of the smaller independents who inherited the assets chose not to undertake detailed 3-D seismic analyses, detailed formation evaluation utilizing more sophisticated logging or take core samples, all of which can help with a better understanding of the reservoir and enhance oil recoveries.  Nobel, through its recently announced joint ventures in Texas such as with Millennium in Gonzales County, is taking steps to address this deficiency and sees enormous potential for a similar approach in Tunisia.

Tunisia has an attractive suite of under-explored and under-developed opportunities. Nobel has developed an excellent network of contacts in country following our recent visit and we are evaluating a number of exciting opportunities there. Our technical team has many years of experience operating in Tunisia for other companies. Tunisia also has an attractive fiscal regime as well as underutilized gas infrastructure, well-positioned to service shortfalls in Europe to which it is already connected through the TransMed gas pipeline. While our near-term focus is on oil, we will be targeting gas opportunities in Tunisia and the US for the mid- to long-term."

-ENDS-

This announcement contains inside information within the meaning of Article 7(1) of (i) Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014, as amended (the "EU Market Abuse Regulation") and (ii) the EU Market Abuse Regulation as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018.

Enquiries

Pennpetro Energy PLC
T om Evans, CEO	[e-mail]
Arden Partners Plc
Simon Johnson	[phone]
Ruari McGirr
Peterhouse Capital Limited
Lucy Williams	[phone]
Duncan Vasey	[phone]
Instinctif Partners
Galyna Kulachek	[e-mail]
Sarah Hourahane	[phone]

NOTES TO EDITORS

Pennpetro Energy is an independent oil and gas company focusing on production in the Gonzales Oil Field in Texas, USA. Shares in the company were admitted to the Official List of the London Stock Exchange by way of a Standard Listing on 21 December 2017.

Further information on the Company can be found at www.pennpetroenergy.co.uk

 

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