Completion of Bridging Loan and Issue of Warrants

16 April 2019

 

Tower Resources plc

Completion of Bridging Loan Facility

Issue of Warrants

 

Tower Resources plc (the "Company" or "Tower" (TRP.L, TRP LN)), the AIM listed oil and gas company with its focus on Africa, is pleased to announce that, further to the Company's announcement earlier today outlining the proposed interim financing, the Company has successfully agreed a Bridging Loan Facility ("Bridging Loan") of US$750,000 with a single lender. The terms of the Bridging Loan include the issue of 90 million of attached five-year 1.0 pence warrants.

As previously disclosed, the purpose of the Bridging Loan is to cover working capital while the Company seeks to finalise funding arrangements for the drilling of the NJOM3 well on the Thali licence in late May 2019.  

 

Bridging Loan Facility and Issue of Warrants

 

The Company has agreed a short term senior secured funding facility of US$750,000 with Pegasus Petroleum Ltd, a company beneficially owned by the Company's Chairman Jeremy Asher.  The material terms of the facility comprise fees of 2%, interest of 1% per month accrued and paid on repayment, a fixed and floating charge over the Company's assets, and the issue of 90 million 5-year warrants priced at 1.0 pence per share ("Warrants"), which is a premium of 38% over the Company's closing mid-market share price on 15 April 2019. The Bridging Loan will be due for repayment on or before 30 June 2019 and will have a preferential right of repayment from any future financing secured by the Company.  

 

The issue of Warrants has been summarised in the table below.

 

Director	Number of Warrants being issued	Total number of Warrants held including this issue*	Shareholding upon exercise of total number of Warrants held	% of issued share capital upon exercise of Warrants‡
Jeremy Asher	90,000,000†	127,908,865	198,800,360	24.5
Peter Taylor	-	17,190,413	35,642,139	4.4
Graeme Thomson	-	15,690,413	20,841,180	2.6

*Warrants are held at different prices

† Warrants issued to Pegasus Petroleum Ltd; a company beneficially owned by Jeremy Asher

‡Excludes share options

 

 

Related Party Transaction

 

Jeremy Asher, as a director of the Company, and Pegasus Petroleum Ltd, are considered to be "related parties" as defined under the AIM Rules and accordingly, the Bridging Loan constitutes a related party transaction for the purposes of Rule 13 of the AIM Rules.

 

The Directors independent of the Bridging Loan, being Peter Taylor, Graeme Thomson and David M Thomas, consider, having consulted with SP Angel Corporate Finance LLP, the Company's nominated adviser, that the terms of the Bridging Loan are fair and reasonable insofar as the Company's shareholders are concerned.

 

Peter Taylor, Non-Executive Director, commented:

 

"This funding facility provides additional working capital which we need to complete the well financing process. Our Chairman's participation reflects his continuing confidence in the Company and in our Cameroon project."

 

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

 

 Contacts

 

Tower Resources plc	[email protected]
Jeremy Asher Chairman and CEO
Andrew Matharu VP - Corporate Affairs
SP Angel Corporate Finance LLP Nominated Adviser and Joint Broker	+44 20 3470 0470
Stuart Gledhill Caroline Rowe
Turner Pope Investments (TPI) Limited Joint Broker Andy Thacker	+44 20 3621 4120
Whitman Howard Limited Joint Broker Nick Lovering Hugh Rich	+44 20 7659 1234
Yellow Jersey PR Limited	+44 20 3735 8825
Tim Thompson

 

Notes:

 

Tower Resources Cameroon S.A, a wholly-owned subsidiary of Tower Resources plc, holds a 100% interest in the shallow water Thali (formerly known as "Dissoni") Production Sharing Contract (PSC), in the Rio del Rey basin, offshore Cameroon. Tower was awarded the PSC on 15 September 2015 for an Initial Exploration Period of 3 years, which has been extended for a further year ending 15 September 2019.

The Thali PSC covers an area of 119.2 km², with water depths ranging from 8 to 48 metres, and lies in the prolific Rio del Rey basin, in the eastern part of the Niger Delta. The Rio del Rey basin has, to date, produced over one billion barrels of oil and has estimated remaining reserves of 1.2 billion barrels of oil equivalent ("boe"), primarily within depths of less than 2,000 metres. The Rio del Rey is a sub-basin of the Niger Delta, an area in which over 34.5 billion barrels of oil has been discovered, with 2.5 billion boe attributed to the Cameroonian section.

An independent Reserve Report conducted by Oilfield International Limited (OIL) has highlighted the contingent and potential resources on the Thali licence and the associated Expected Monetary Value (EMV) as follows:

§ Gross mean contingent resources of 18 MMbbls of oil across the proven Njonji-1 and Njonji-2 fault blocks;

§ Gross mean prospective resources of 20 MMbbls of oil across the Njonji South and Njonji South-West fault blocks;

§ Gross mean prospective resources of 111 MMbbls of oil across four identified prospects located in the Dissoni South and Idenao areas in the northern part of the Thali licence;

§ Calculated EMV10s of US$118 million for the contingent resources, and US$82 million for the prospective resources, respectively.

 

In accordance with the guidelines for the AIM market of the London Stock Exchange, Dr Mark Enfield, BSc, PhD, FGS, Advisor to the Board of Tower Resources plc, who has over 30 years' experience in the oil & gas industry, is the qualified person that has reviewed and approved the technical content of this announcement.

 

 

 

 

NOTIFICATION AND PUBLIC DISCLOSURE OF TRANSACTIONS BY PERSONS DISCHARGING MANAGERIAL RESPONSIBILITIES AND PERSONS CLOSELY ASSOCIATED WITH THEM:

MANAGERIAL RESPONSIBILITIES AND PERSONS CLOSELY ASSOCIATED WITH THEM

1.	Details of the person discharging managerial responsibilities/person closely associated
a)	Name:	Jeremy Asher
2.	Reason for the notification
a)	Position/status:	Chairman and Chief Executive Officer
b)	Initial notification/Amendment:	Initial notification
3.	Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor
a)	Name:	Tower Resources PLC
b)	LEI:	2138002J9VH6PN7P2B09
4.	Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a)	Description of the financial instrument, type of instrument: Identification code:	Ordinary Shares of 1 pence each GB00BZ6D6J81
b)	Nature of the transaction:	Warrants attached to loan
c)	Price(s) and volume(s):	Price(s) Volume(s) 1.00  pence 90,000,000
d)	Aggregated information: Aggregated volume: Price:	Single transaction as in 4 c) above Price(s) Volume(s)  1.00 pence 90,000,000
e)	Date of the transaction:	16 April 2019 07:00 GMT