Holdings in Company

RNS Number : 9035H

Block Energy PLC

20 November 2018

 

Block Energy Plc / Index: AIM / Epic: BLOE.L / Sector: Oil and Gas

20 November 2018

Block Energy Plc ("the Company", "Block" or "the Group")

Holdings in Company

Block Energy Plc, the exploration and production company focused on the Republic of Georgia, has today been notified by Mayan Energy ('Mayan') that Mayan has disposed of its entire 3.29% interest in Block in order to allocate its resources to the development of its onshore US oil and gas assets.

Mayan's entire 3.29% interest in Block has been acquired by three existing shareholders in the Company, all of whom participated in the oversubscribed £5million placing at the time of Block's Admission to AIM in June 2018.  All three shareholders have expressed their continued support for the fully funded multi-well work programme that is underway at Block's 100% owned Norio oil field targeting a 15-fold increase in production to 150 bopd by Q1 2019.  In addition, preparations are ongoing to drill a horizontal sidetrack programme and test the gas resource base on its West Rustavi licence which has been assigned net contingent resources of 456 BCF and lies on trend to the same play being targeted by Schlumberger on neighbouring fields.

TR-1: Standard form for notification of major holdings

NOTIFICATION OF MAJOR HOLDINGS (to be sent to the relevant issuer and to the FCA in Microsoft Word format if possible)i
1a. Identity of the issuer or the underlying issuer of existing shares to which voting rights are attachedii:			Block Energy plc
1b. Please indicate if the issuer is a non-UK issuer  (please mark with an "X" if appropriate)
Non-UK issuer
2. Reason for the notification (please mark the appropriate box or boxes with an "X")
An acquisition or disposal of voting rights						x
An acquisition or disposal of financial instruments
An event changing the breakdown of voting rights
Other (please specify)iii:
3. Details of person subject to the notification obligationiv
Name			Mayan Energy Ltd
City and country of registered office (if applicable)			London, UK
4. Full name of shareholder(s) (if different from 3.)v
Name
City and country of registered office (if applicable)
5. Date on which the threshold was crossed or reachedvi:			19 November 2018
6. Date on which issuer notified (DD/MM/YYYY):			19 November 2018
7. Total positions of person(s) subject to the notification obligation
	% of voting rights attached to shares (total of 8. A)	% of voting rights through financial instruments (total of 8.B 1 + 8.B 2)		Total of both in % (8.A + 8.B)	Total number of voting rights of issuervii
Resulting situation on the date on which threshold was crossed or reached	0.0			0.0	259,047,601
Position of previous notification (if applicable)	8,510,341			8,510,341

8. Notified details of the resulting situation on the date on which the threshold was crossed or reachedviii
A: Voting rights attached to shares
Class/type of shares ISIN code (if possible)		Number of voting rightsix					% of voting rights
		Direct (Art 9 of Directive 2004/109/EC) (DTR5.1)		Indirect (Art 10 of Directive 2004/109/EC) (DTR5.2.1)			Direct (Art 9 of Directive 2004/109/EC) (DTR5.1)		Indirect (Art 10 of Directive 2004/109/EC) (DTR5.2.1)
ORDINARY SHARES		0.0					0.0
SUBTOTAL 8. A
B 1: Financial Instruments according to Art. 13(1)(a) of Directive 2004/109/EC (DTR5.3.1.1 (a))
Type of financial instrument		Expiration datex	Exercise/ Conversion Periodxi			Number of voting rights that may be acquired if the instrument is exercised/converted.			% of voting rights
			SUBTOTAL 8. B 1
B 2: Financial Instruments with similar economic effect according to Art. 13(1)(b) of Directive 2004/109/EC (DTR5.3.1.1 (b))
Type of financial instrument	Expiration datex		Exercise/ Conversion Period xi		Physical or cash settlementxii			Number of voting rights	% of voting rights
					SUBTOTAL 8.B.2

9. Information in relation to the person subject to the notification obligation (please mark the applicable box with an "X")
Person subject to the notification obligation is not controlled by any natural person or legal entity and does not control any other undertaking(s) holding directly or indirectly an interest in the (underlying) issuerxiii
Full chain of controlled undertakings through which the voting rights and/or the financial instruments are effectively held starting with the ultimate controlling natural person or legal entityxiv (please add additional rows as necessary)
Namexv	% of voting rights if it equals or is higher than the notifiable threshold	% of voting rights through financial instruments if it equals or is higher than the notifiable threshold	Total of both if it equals or is higher than the notifiable threshold
10. In case of proxy voting, please identify:
Name of the proxy holder
The number and % of voting rights held
The date until which the voting rights will be held
11. Additional informationxvi

Place of completion	UK
Date of completion	19/11/2018

This announcement contains inside information which is disclosed in accordance with the Market Abuse Regulation which came into effect on 3 July 2016.

**ENDS**

For further information visit www.blockenergy.co.uk or contact:

Paul Haywood Chief Executive Officer	Block Energy Plc	Tel: [phone]
Neil Baldwin (Nominated Adviser)	Spark Advisory Partners Limited	Tel: [phone]
Craig Fraser (Joint Corporate Broker)	Baden Hill, a trading name of Northland Capital Partners ltd.	Tel: [phone]
Colin Rowbury (Joint Corporate Broker)	Novum Securities Ltd	Tel: [phone]
Frank Buhagiar / Juliet Earl (Financial PR)	St Brides Partners Ltd	Tel: [phone]

Notes:

Block Energy (BLOE.L) is an AIM quoted oil and gas company with a growing portfolio of production, development and exploration assets in the Republic of Georgia.  Block holds a 100% Working Interest ('WI') in the producing Norio licence, a 90% WI in the producing Satskhenisi licence and a 25% WI in the West Rustavi licence with the right to farm-in to up to a 75% WI.  Block's three licences lie in the heart of the Schlumberger's 100% held position in the Kura basin, which at its peak produced ~70,000 barrels of oil per day ('bopd') in Georgia and is estimated to hold over 7 billion barrels of proven reserves in Azerbaijan and North Caucasus (Russia).

The licences currently hold estimated net proven oil reserves of 1.5 million barrels plus 61 million barrels unrisked contingent oil resources ('2C').  Furthermore, the West Rustavi permit has estimated gross unrisked contingent gas resources (2C) of 608 BCF. Multiple gas discoveries have already been made in the Lower Eocence and Upper Cretaceous within the Licence and lie on trend with the same play currently being targeted by Schlumberger on neighbouring licence, Block XIb. The estimated cost of gas development and production at West Rustavi is c.US$2.00/Mcf which equates to operating netbacks of c.US$2.6/Mcf (assuming a 75% working interest) - Georgia currently purchases its gas for c.US$5.5 /Mcf (c.US$600m project value to the Company). 

Appraisal of West Rustavi gas prospects is expected to be conducted contemporaneously with the rehabilitation of the producing Norio (100% WI) and Satskhenisi fields (90% WI) which provide immediate production uplift on commencement of field operations in Q1 2019.  The near-term target is to raise production to 900 bopd from 15 bopd within 18 months via a low cost, low risk workover and sidetrack programme, and then to utilise cash flow from production to drill new horizontal wells and sidetracks to raise production to c.2,000 bopd over the medium term.  Oil production across  the fields offer excellent netbacks, with the current cost of production of c.US$25 per barrel providing netbacks of c. US$30-35 per barrel.

 

END

 

 

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