MOROCCO: Predator Oil & Gas Raises £1.035 million for Drilling Operations

Highlights          

·    Secure option on rig to drill within a definitive time window 

·    Planned construction of two well pads 

·    Competitiveness in accessing well services and materials enhanced 

·    Second gas target identified for first well 

·    Exploration target for Jurassic gas being matured 

·    Quote received and reviewed for MOU-1 well testing

 Predator Oil & Gas has announced that it has conditionally placed 11,500,000  new ordinary shares of no par value in the Company  at a placing price of 9 pence each to raise £1.035 million before expenses. 

Use of Proceeds

The Company is primarily intent in the near-term on expanding and executing its planned 2022 drilling operations in Morocco as issues relating to security and cost of gas supply  are set to be critical factors during the Energy Transition influencing the ability to deliver affordable energy.

The strengthening of the Company’s financial resources facilitates the exercise of an option to drill using the Star Valley Rig 101 within a definitive time window following all regulatory, environmental and partner approvals. A rig inspection will be carried out shortly by the Company. The option covers drilling up to three wells in 2022.

Civil works to construct the MOU-4 and MOU-5 well pads will commence following receipt of all outstanding regulatory, environmental and partner approvals.

Rising costs of materials and services impacted by current tensions in Eastern Europe dictate that it is prudent to allow for cost inflation to maintain competitiveness in seeking quotes for well services and equipment and for maintaining aggressive drilling timelines.

MOU-5 is now being prioritised ahead of MOU-4 for the first well in the drilling programme. Following desk-top modelling of seismic response to gas in MOU-1, two shallower gas targets additional to the primary “MOU-4 Fan” appraisal target have been identified at the MOU-5 well location. The shallowest of these targets had strong formation gas shows in MOU-1 (dry gas) and was penetrated in MSD-1 where good quality reservoir was logged.

The MOU-NE prospective lead is being matured as a potential third well in the planned drilling programme. 2D seismic reprocessing over this feature will be completed by the end of May 2022. The primary target following further desk-top studies is now anticipated to be a Lower Jurassic carbonate platform build-up with potential for leached porosity development covering potentially up to 100 sq. km., albeit within an area that lacks extensive seismic coverage. Dry gas shows were encountered in TFR-1X at the top of this interval. MOU-NE will potentially test the play concept some 1500+ metres higher than the TFR-1X structure in an area favourably located for gas charge from the MOU-1 Tertiary basin.  It represents a high-risk target but an opportunity to test for Jurassic gas close to infrastructure at a drilling depth of less than 1,450 metres TVD KB.

Additional funding allows the Company to further progress its: FSRU LNG import projects for Ireland and, potentially, Morocco; set-up the next CO2 EOR project in Trinidad; and further develop its concept to seek synergies for green hydrogen and natural gas hybrid developments.

Existing working capital is sufficient to meet the Company’s existing commitments and corporate overheads in 2022, including the testing of MOU-1 which will be synchronised with mobilising the well services and equipment for MOU-5 to reduce mobilisation and demobilisation costs. A quote for testing has been received from Schlumberger and has been reviewed.

                                                                      USE OF NET PROCEEDS

       WORK PROGRAMME

                                           REASONS

  COSTS (GBP)

Advance payment to Star Valley

To secure option to drill within an agreed time window and to carry out maintenance checks on Rig 101 ahead of planned drilling operations

             275,000

Civil works MOU-4 and MOU-5

Upon receipt of all regulatory, environmental and partner approvals build the well pads at MOU-4 and MOU-5

             250,000

Well inventory purchases for MOU-4 and MOU-5

To cover increases due to rising costs of materials and services impacted by current political tensions in Eastern Europe

             125,000

Update MOU-4 and MOU-5 well design

Based on lessons learnt from MOU-1 and potential for cost savings

               50,000

Mature MOU-NE prospect

Based on results of 2D seismic reprocessing expected in May this year and prepare a scoping drilling proposal

               60,000

CNG Morocco

Environmental Impact Assessment for potential CNG pilot development at Guercif

               50,000

CO2 EOR Trinidad

Carry out maintenance check on CO2 EOR equipment and prepare desk-top study for implementation of CO2 EOR in Lease Operators PS-1 field onshore Trinidad – basis for negotiating terms for joint venture SPV for CO2 EOR operations

               40,000

FSRU LNG and gas storage Ireland

Prepare public relations document and programme for the National Energy Conference Croke Park Dublin 26 April 2022Complete capacity study with third-party owner of gas infrastructure

               40,000

New Ventures

Progress LNG FSRU options for Morocco

Progress synergies for green hydrogen and natural

gas co-developments

               60,000

TOTAL GBP950,000

CURRENT WORKING CAPITAL

Current working capital is sufficient for the purposes of

existing commitments and corporate overheads through 2022 including discussions with potential farminees and gas purchasers

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