Egdon Completes Purchase of YCI Resources
The Directors of Egdon Resources plc are pleased to announce that the company has completed the acquisition of YCI Resources Limited ("YCIR") from the Heyco Energy Group.
As previously reported the consideration for the transaction is the issue to Heyco International, S.L. ("Heyco") of 6,861,434 Ordinary shares in Egdon. Application has been made for the consideration shares to be admitted to AIM and the shares are expected to be admitted on March 18, 2009.
Following the admission of these shares Egdon Resources plc will have a total of 75,475,774 Ordinary Shares in Issue. Heyco will hold 9.1% of the enlarged share capital of Egdon.
Egdon has also granted Heyco a Net Profit Interest ("NPI") on current and future production from licenses PEDL069 and PEDL070. The NPI, which is related to oil price, will range between 5% and 10% of Egdon's net revenues realised from these licenses after subtracting allowable costs.
Egdon Resources plc is an established UK-based exploration and production company primarily focused on onshore exploration and production in the hydrocarbon-producing basins of the UK and mainland Europe.
Egdon holds interests in twenty-six licenses in the UK and France and has an active program of exploration, appraisal and development within its balanced portfolio of oil and gas assets. Egdon is an approved operator in both the UK and France.
Egdon currently has production from the Keddington and Avington oil fields. Further oil and gas production is anticipated from Kirklington, Kirkleatham, Waddock Cross, Eakring-Dukes Wood during the next twelve months.
Egdon Resources plc listed on AIM in January 2008, following the demerger of its gas storage business, Portland Gas plc. The pre-demerged business was formed in 1997 and listed on AIM in December 2004.
YCI Resources Limited
YCI Resources Limited is a UK registered private company whose principal asset is a 16.667% interest in PEDL070, which contains the Avington oil field and is located in the Weald Basin of Southern England. YCIR also has a 33.334% interest in adjacent license PEDL069 which Egdon maps as containing a possible northerly extension to the Avington field. This transaction will increase Egdon's interests to 36.667% in PEDL070 and to 66.667% in PEDL069.
The Avington oil field was discovered in 2003 with the drilling of the Avington-2 well which tested light oil from the Jurassic age Great Oolite reservoir. During 2007 the drilling and extended production testing of the Avington-3z well established the commerciality of the field with production of 63,000 barrels of oil during the six months test. During 2008 the operator, Star Energy, obtained the required planning and other consents to improve the surface facilities and restart production from the Avington-3z and Avington-2z wells. In addition consent was granted to drill two further appraisal wells on the accumulation. As previously reported by the Company, production commenced at Avington on January 23, 2009, at an initial free-flowing rate of around 300 barrels per day. The Avington-3z well has subsequently been completed with a down-hole pump and is currently on production.
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