Share Name Share Symbol Market Type Share ISIN Share Description
I3 Energy Plc LSE:I3E London Ordinary Share GB00BDHXPJ60 ORD 0.01P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -0.20 -2.41% 8.10 8.00 8.20 8.30 8.10 8.30 291,358 09:04:34
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Oil & Gas Producers 0.0 -2.0 -5.0 - 9

i3 Energy PLC Corporate and Funding Update

02/01/2020 7:00am

UK Regulatory (RNS & others)


I3 Energy (LSE:I3E)
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2 Months : From Dec 2019 to Feb 2020

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TIDMI3E

RNS Number : 4673Y

i3 Energy PLC

02 January 2020

2 January 2020

i3 Energy plc

("i3" or the "Company")

Corporate and Funding Update

i3 Energy plc, an independent oil and gas company with assets and operations in the UK, is pleased to announce the following update.

2020 planning and farm-out process underway

Following i3's 2019 drilling campaign at Serenity and Liberator, the Company is now preparing for a mid-2020 appraisal programme to delineate the fields which the Company believes could contain more than 600 MMbbls P50 STOIIP.

Well and fluid data from the Serenity 13/23c-10 discovery well encountered sweet, 31.5deg API crude in 11 feet of upper Captain oil-bearing sands. The measured oil column on structure, observed through pressure data, was 604 feet true vertical depth (TVD). If the Serenity and neighbouring Tain oil field are in communication as i3 expects, then this infers an oil column height of 1124 feet TVD. On the basis of information recovered from the discovery well, the Company retains its pre-drill estimate of 197 mmbbls P50 STOIIP for Serenity. The Company expects the thickness of the upper Captain sands package to increase, potentially substantially, moving westward along structure, based upon a measured sand thickness of 115 ft true vertical thickness (TVT) immediately west of the Serenity accumulation in the 13/23a-7A well. The 13/23c-10 well has confirmed the strong commercial potential of the Serenity area, and reservoir model simulations demonstrate potential recovery factors above 60%.

Though Liberator wells 13/23c-9 and 13/23c-11 did not meet i3's expectations, the latter confirmed a migration path for hydrocarbons to move westward towards the "Minos High" where the upper Captain sands package is estimated to have a thickness of circa 200 ft TVT above the oil-water contact. Post-drill mapping of the entire Liberator structure still shows potential in-place resources above 400 MMbbls.

With the highly successful Serenity discovery and remaining potential at Liberator, the Company has begun planning a mid-2020, multi-well appraisal programme and is simultaneously conducting a farm-down process of its licences to potentially fund the 2020 drilling campaign. The Company will continue working with its senior lenders on a development facility for its assets. Future drilling remains subject to funding and i3 will update the market on these endeavours in due course as material progress is made.

GE UK warrants for services rendered

As part of an agreement announced 2 July 2019, i3 Energy has issued a further 2,816,739 warrants to subscribe for Ordinary Shares at an exercise price of 56.85 pence per Ordinary Share to GE Oil & Gas UK Limited ("GE UK"), in addition to the 2,204,574 issued to GE UK and as announced on 29 October 2019. As previously referenced in the Company's July announcement, these warrants relate to deferred payments for Oilfield Service ("OFS") contracts entered into between i3 and Baker Hughes. To 30 November 2019, Baker Hughes had performed and invoiced i3 Energy for GBP3,000,000 worth of oilfield services. GE UK can exercise the warrants via cash settlement or in exchange for payments due to Baker Hughes under OFS contracts with the Company. Junior Noteholders will be offered participation in warrants on the same terms as GE UK, pro-rata to their ownership of i3 Energy on a fully-diluted basis, and also pro-rata to the proportion of warrants issued to GE UK under this arrangement. Any warrants subscribed to by Junior Noteholders, in addition to 255,732 warrants remaining due to GE UK for OFS rendered by Baker Hughes, will be subject to shareholder approval at a General Meeting of the Company expected to occur before mid-February.

In accordance with the provisions of the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority, the Company confirms its issued ordinary share capital comprises 107,719,400 Ordinary Shares of GBP0.0001 each. All of the Ordinary Shares have equal voting rights and none of the Ordinary Shares are held in Treasury. The above figure may be used by shareholders as the denominator for the calculations to determine if they are required to notify their interests in, or change to their interest in, the Company.

With the above issuance of warrants to GE UK, the Company now has 9,503,798 warrants exercisable at 40p/share, notional GBP8 million warrants exercisable at 40.7p/share, notional GBP8 million warrants exercisable at 48.1p/share, notional GBP8 million warrants exercisable at 55.5p/share, and 5,021,313 warrants exercisable at 56.85p/share which, when fully exercised in aggregate, would convert into 65,227,561 Ordinary Shares of GBP0.0001 each in the Company.

Majid Shafiq, CEO of i3 Energy commented:

"The discovery of the Serenity oil field was a transformational event in i3's history. We are very excited about the further drilling operations we expect to conduct in 2020 and see this as the lowest risk path to unlocking substantial shareholder value. We believe our acreage, together with the data retrieved from our 2019 drilling campaign, will be very attractive to potential farminees looking to add material barrels and near-term production to their portfolios."

S

CONTACT DETAILS:

 
   i3 Energy plc 
    Majid Shafiq (CEO) / Graham Heath      c/o Camarco 
     (CFO)                                  Tel: +44 (0) 203 781 8331 
 
     WH Ireland Limited (Nomad and Joint 
     Broker) 
    James Joyce, James Sinclair-Ford       Tel: +44 (0) 207 220 1666 
 
 
    Canaccord Genuity Limited (Joint       Tel: +44 (0) 207 523 8000 
     Broker) 
     Henry Fitzgerald- O'Connor, James 
     Asensio 
    Camarco 
     Jennifer Renwick, James Crothers       Tel: +44 (0) 203 781 8331 
 
 
 
  Notes to Editors: 
   i3 is an oil and gas development company initially focused 
   on the North Sea. The Company's core asset is the Greater 
   Liberator Area, located in Blocks 13/23d and 13/23c, to which 
   i3's independent reserves auditor attributes 11 MMBO of 2P 
   Reserves, 22 MMBO of 2C Contingent Resources and 47 MMBO of 
   mid-case Prospective Resources. The Greater Liberator Area 
   consists of the Liberator oil field discovered by well 13/23d-8 
   and the Liberator West extension. The Greater Liberator Area, 
   along with the Company's Serenity Discovery located in the 
   northern half of Block 13/23c and for which it carries a STOIIP 
   of 197 MMbbls, are owned and operated on a 100% working interest 
   basis. 
 
   The Company's strategy is to acquire high quality, low risk 
   producing and development assets, to broaden its portfolio 
   and grow its reserves and production. 
 
   The information contained within this announcement is deemed 
   by the Company to constitute inside information under the 
   Market Abuse Regulation (EU) No. 596/2014. 
   Qualified Person's Statement: 
   In accordance with the AIM Note for Mining and Oil and Gas 
   Companies, i3 discloses that Mihai Butuc, i3's New Ventures 
   Manager, is the qualified person who has reviewed the technical 
   information contained in this document. He graduated as a 
   Diplomat Engineer, Geology and Geophysics from the University 
   of Bucharest in 1985 and is a member of the Society of Petroleum 
   Engineers. Mihai Butuc consents to the inclusion of the information 
   in the form and context in which it appears. 
 

Glossary

 
 
 
 "BCF" or "bscf"               billion (10(9) ) standard cubic feet; 
 "Boe"                       barrels of oil equivalent. One barrel 
                                of oil is approximately the energy 
                                equivalent of 6,000 standard cubic 
                                feet of natural gas; 
 
 "boepd"                       Barrels of oil equivalent per day; 
 
 "MMBO" or "MMbbls"            millions (10(6) ) of barrels of oil; 
 "MMboe"                       millions (10(6) ) of barrels of oil 
                                equivalent; 
 
 "MMcfd" or "MMscfd"           millions (10(6) ) of standard cubic 
                                feet per day; 
 
 "MMstb"                       millions (10(6) ) of stock tank barrels 
                                of oil; 
 "Net Present Value" or        the discounted value of an investment's 
  "NPV"                         cash inflows minus the discounted value 
                                of its cash outflows; 
 
 "PRMS"                        The SPE/WPC/AAPG/SPEE Petroleum Resources 
                                Management System for Reserves and 
                                Resources Classification; 
 "standard cubic feet"         standard cubic feet measured at 14.7 
  or "scf"                      pounds per square inch and 60 degrees 
                                Fahrenheit; 
 
 Stock Tank Oil Initially      a method of estimating how much oil 
  In Place or "STOIIP"          in a reservoir can be economically 
                                brought to the surface; 
 
                                     RESOURCES 
 
   "Contingent Resources"        those quantities of petroleum estimated, 
                                 as of a given date, to be potentially 
                                 recoverable from known accumulations, 
                                 but the applied project(s) are not 
                                 yet considered mature enough for commercial 
                                 development due to one or more contingencies; 
 "Prospective Resources"       those estimated volumes associated 
                                with undiscovered accumulations. These 
                                represent quantities of petroleum which 
                                are estimated, as of a given date, 
                                to be potentially recoverable from 
                                oil and gas deposits identified on 
                                the basis of indirect evidence but 
                                which have not yet been drilled; 
 
   "P10 resource"                reflects a volume estimate that, assuming 
   "High case resource"          the accumulation is developed, there 
                                 is a 10% probability that the quantities 
                                 actually recovered will equal or exceed 
                                 the estimate. This is therefore a high 
                                 estimate of resource; 
 "P50 resource"                reflects a volume estimate that, assuming 
  "Mid case resource"           the accumulation is developed, there 
                                is a 50% probability that the quantities 
                                actually recovered will equal or exceed 
                                the estimate. This is therefore a median 
                                or best case estimate of resource; 
 "P90 resource"                reflects a volume estimate that, assuming 
  "Low case resource"           the accumulation is developed, there 
                                is a 90% probability that the quantities 
                                actually recovered will equal or exceed 
                                the estimate. This is therefore a low 
                                estimate of resource; 
 
                                      RESERVES 
 "Proved Reserves"             those quantities of petroleum which, 
                                by analysis of geological and engineering 
                                data, can be estimated with reasonable 
                                certainty to be commercially recoverable, 
                                from a given date forward, from known 
                                reservoirs and under current economic 
                                conditions, operating methods and government 
                                regulations. Proved reserves can be 
                                categorised as developed or undeveloped. 
                                If deterministic methods are used, 
                                the term reasonable certainty is intended 
                                to express a high degree of confidence 
                                that the quantities will be recovered. 
                                If probabilistic methods are used, 
                                there should be at least a 90% probability 
                                that the quantities actually recovered 
                                will equal or exceed the estimate; 
 
 "Probable Reserves"           those unproved reserves which analysis 
                                of geological and engineering data 
                                suggests are more likely than not to 
                                be recoverable. In this context, when 
                                probabilistic methods are used, there 
                                should be at least a 50% probability 
                                that the quantities actually recovered 
                                will equal or exceed the sum of estimated 
                                Proved plus Probable reserves; 
 "Possible Reserves"           those additional reserves which analysis 
                                of geological and engineering data 
                                suggests are less likely to be recoverable 
                                than Probable Reserves. In this context, 
                                when probabilistic methods are used, 
                                there should be at least a 10% probability 
                                that the quantities actually recovered 
                                will equal or exceed the sum of estimated 
                                Proved plus Probable plus Possible 
                                reserves; 
 "Reserves"                    those quantities of hydrocarbons which 
                                are anticipated to be commercially 
                                recovered from known accumulations; 
 "Justified for Development"   implementation of the development project 
                                is justified on the basis of reasonable 
                                forecast commercial conditions at the 
                                time of reporting, and there are reasonable 
                                expectations that all necessary approvals/contracts 
                                will be obtained; 
 
 "1P"                          the Proved Reserves; 
 
 "2P"                          the sum of Proved plus Probable Reserves; 
 
 "3P"                          the sum of Proved plus Probable plus 
                                Possible Reserves. 
 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

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