NuEnergy Gas Limited (ASX: NGY) is an Australia registered company, involved in various gas exploration activities. On 3rd June 2019, the company updated the market about the investment agreement with Saujana E&P Sdn Bhd related to Saujana E&P’s strategic investment in NuEnergy through share placement of 1,540,832,050 new NuEnergy shares. It is equivalent to 51% of the enlarged share capital of the NGY in consideration of $0.025 per share along with total subscription value amounting to $38,520,801 upon the terms and subject to the conditions of the investment agreement.
The Saujana E&P requested a further extension till 7th June 2019 for the deposit payment, which was due to be paid on 31st May 2019. NGY extended the deposit payment date to 7th June 2019, in consideration of extension fee totaling to US$250,000, which is to be paid to NGY by 4th June 2019. Additionally, the company communicated that this extension fee will be deemed as part payment of the deposit, if Saujana E&P fails to pay deposit by the deadline, the extension fee might be forfeited by NuEnergy.
Moving to Quarterly Report for March 2019. The company’s operations were primarily focused on extending the Muralim Production Sharing Contract to continue with appraisal activities and to ramp up the Plan of Development proposal. NGY is the operator of the Muralim PSC and holds a 50% participating interest along with Medco holding the remaining 50% participating interest.
Separately, looking at the half-yearly results. The group reported a net loss of $806,964 for the half year to 31 December 2018, when compared to a net loss of $11,419,526 for the prior corresponding half year. The decrease in net loss was attributed to the full impairment of the exploration and evaluation of asset amounting to $11,397,870 in the corresponding half year, which was recognised for the Rengat PSC. The Group had cash and cash equivalents of $228,100 as on 31st December 2018, with net assets amounting to $39,867,676. This compares to cash and cash equivalents of $1,369,743, with a net asset position of $38,649,357 at 30th June 2018. The net cash used in the operating activities stood at $0.647 million, including $0.567 million of exploration and evaluation expenses.
Subsequent to the half-year end, NGY inked a loan agreement with AIC Corporation Sdn Bhd, which is a related party to the company’s directors, namely Goh Tian Chuan and Chen Heng Mun. In addition, Globaltec Formation Berhad, the group’s ultimate parent will raise US$300,000 to fund part of the CBM planned exploration activities. NGY communicated that this loan is unsecured and repayable on demand along with financing cost of 10% per-annum charged on the outstanding loan computed.
The stock of NGY last traded on 3rd June 2019 at a price of $0.014 per share, no shares were traded on 4th June 2019 (as at AEST: 2:23 PM). The market capitalisation of the company is $26.66 million. The stock has provided an annual return of -65.00% and delivered returns of -48.15% and 16.00% for the three months and one-month period, respectively.
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