1 February 2023

Zephyr Energy plc

(the "Company" or "Zephyr")

Issue of equity and change to total voting rights

Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF), the Rocky Mountain oil and gas company focused on responsible resource development and carbon-neutral operations, announces that application has been made to the London Stock Exchange for 13,483,095 new ordinary shares of 0.1 pence each in the Company (the "new Ordinary Shares") to be admitted to trading on AIM ("Admission").

The issue of the new Ordinary Shares is the first tranche of the consideration for the acquisition of the remaining 25 per cent working interest across the White Sands Unit in the Paradox Basin, Utah, U.S. (the "Paradox Acquisition"), as announced on 21 December 2022. It is expected that Admission will occur on or around 10 February 2023 whereupon the Paradox Acquisition is expected to complete.

The second and final tranche of the acquisition consideration is payable by the issue of 26,966,189 ordinary shares of 0.1p each in the Company to the vendor upon Zephyr's final investment decision with respect to the contract award to a primary contractor to commence construction activities to make the Powerline Road gas processing plant operational.

The new Ordinary Shares will be subject to a lock-up period which will expire at the earlier of the date that first gas from the State 36-2 LNW-CC well is sold via the Dominion Energy 16-inch gas export pipeline or 15 December 2023. 

Total voting rights

The issued share capital of the Company on Admission will be 1,596,501,823 ordinary shares of 0.1 pence each with one voting right per share. The Company does not hold any shares in treasury. The total number of ordinary shares and voting rights in the Company is therefore 1,596,501,823. With effect from Admission, this figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the FCA's Disclosure Guidance and Transparency Rules.

Contacts

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 with the State 36-2 LNW-CC well - 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 production of 1,550 - 1,750 barrels of oil equivalent per day, net to Zephyr, in 2023.  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.