EnCore Oil is in advanced negotiations with Egdon Resources over the sale of the Company's onshore assets (onshore UK and onshore France) together with an interest in the Ceres Gas field, to Egdon, in return for a material equity stake in Egdon.
The consideration, which would be satisfied in Egdon ordinary shares, will be finalised as part of the contract negotiations and the transaction will be structured so that on completion EnCore's ownership would not exceed 29.9% of Egdon's enlarged share capital.
Further announcements will be made in due course.
Commenting on the negotiations, Alan Booth, EnCore's Chief Executive Officer said, "We have long felt that our onshore asset portfolio failed to generate significant interest amongst many of our shareholders, principally on the grounds of materiality. We believe that by combining these assets with those of Egdon, we would expose our shareholders to more easily recognisable value in a more material portfolio of similar onshore assets. Egdon, as a committed and well established onshore player would be better placed to develop and add significant value to the enlarged asset base.
"We are firmly of the view that it is possible to build a meaningful onshore E&P business, however this will need both scale and management focus. It is our view that this transaction would enable Egdon to accelerate its transition into a significant onshore E&P player."