Zephyr Energy PLC Debt facility update (9103F)

TIDMZPHR

RNS Number : 9103F

Zephyr Energy PLC

10 November 2022

10 November 2022

Zephyr Energy plc

("Zephyr" or the "Company")

Semi-annual redetermination results in

30% increase to availability under Revolving Credit Facility

Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF), the Rocky Mountain oil and gas company focused on responsible resource development from carbon-neutral operations, is pleased to announce that the Company's lender, North-Dakota based First International Bank and Trust ("FIBT"), has completed its regularly scheduled semi-annual redetermination of the Company's revolving credit facility ("RCF").

The redetermination process resulted in a 30% increase to the RCF, with the new borrowing base set at US$13 million. As of today, US$8 million is currently outstanding on the RCF, providing the Company with an additional US$5m of liquidity which can be drawn at Zephyr's discretion. In addition to the RCF, at 1 November 2022, Zephyr had an additional US$15.8 million of outstanding borrowings, the majority of which is comprised of a senior bank term loan with FIBT.

As of today's date the Company has more than US$18.5m in available liquidity taking into account its current cash balances and the increased headroom on the RCF.

The next semi-annual redetermination of the RCF is scheduled to take place in the second quarter of 2023.

Colin Harrington, Zephyr's Chief Executive, said: "The successful redetermination and resulting 30% increase to the RCF borrowing base is an excellent testament to the strength of Zephyr's underlying assets - and the increased debt capacity is particularly notable in light of the Company's production revenues of over US$25 million during the first half of 2022.

"We expect to continue to generate strong free cash flow for the foreseeable future, which in turn will fund the planned expansion of both our operated and non-operated asset portfolios.

"I would like to thank FIBT, a regional bank with over 110 years of history in North Dakota, and its team for their continued strong support of Zephyr."

Contacts:

 
 Zephyr Energy plc                                  Tel: [phone] 
  Colin Harrington (CEO)                                           4590 
  Chris Eadie (CFO) 
 Allenby Capital Limited - AIM Nominated            Tel: [phone] 
  Adviser                                                          5656 
  Jeremy Porter / Vivek Bhardwaj 
 Turner Pope Investments - Joint-Broker             Tel: [phone] 
  James Pope / Andy Thacker                                        0050 
 
  Panmure Gordon (UK) Limited - Joint-Broker 
  John Prior / Hugh Rich / James Sinclair-Ford     Tel: [phone] 
  / Harriette Johnson                                              2500 
 
  Celicourt Communications - PR 
  Mark Antelme / Felicity Winkles 
                                                   Tel: [phone] 
                                                                   2643 
 

Notes to Editors

Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF) is a technology-led oil and gas company focused on responsible resource development from carbon-neutral operations in the Rocky Mountain region of the United States. The Company's mission is rooted in two core values: to be responsible stewards of its investors' capital, and to be responsible stewards of the environment in which it works.

Zephyr's flagship asset is an operated 45,000-acre leaseholding located in the Paradox Basin, Utah, 25,000 acres of which has been assessed by third party consultants Sproule International to hold, net to Zephyr, 2P reserves of 2.1 million barrels of oil equivalent ("mmboe"), 2C resources of 27 mmboe and 2U resources 203 mmboe. Following the successful initial production testing of the recently drilled and completed State 16-2LN-CC well, Zephyr has planned a three well drilling program commencing in 2022 to further delineate the scale and value of the project.

In addition to its operated assets, the Company owns working interests in a broad portfolio of non-operated producing wells across the Williston Basin in North Dakota and Montana.

The Williston portfolio currently consists of working-interests in over 200 modern horizontal wells which are expected to provide US$35-40 million of revenue, net to Zephyr, in 2022. Cash flow from the Williston production will be used to fund the planned Paradox Basin development. In addition, the Board will consider further opportunistic value-accretive acquisitions.

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November 10, 2022 02:00 ET (07:00 GMT)