Reabold (LON:RBD) establishes strong footing on the back of action-packed H1 2022

October 06, 2022 07:49 AM BST | By Team Kalkine Media
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  • Reabold reports an action-packed half year ended 30 June 2022.
  • Corallian Energy Limited received a conditional sale offer.
  • The company has acquired six North Sea licences with attractive development and monetisation prospects.
  • Reabold has acquired a significant stake in Daybreak Oil & Gas, a Californian oil and gas. operator, through the disposal of its own California operations.
  • The group is debt free, and its net cash stood at GBP3.6 million as on 30 June 2022.

Reabold Resources plc (LON:RBD) reported an action-packed half year ended 30 June 2022, in line with its stated strategy of capitalising on the value creation between the entry and exit stages of its projects.

The company’s developments for the first half of 2022 were majorly focused on activities at the Victory and West Newton projects.

Source: © 2022 Kalkine Media®, Data Source: Company’s update

Corallian conditional sale offer: Significantly uplifting Reabold's investment

Reabold, with a 49.99% interest in Corallian Energy Limited, is on the verge of harvesting progress and development at the Victory gas asset. Corallian received an offer of GBP32 million in staged payments from an oil and gas player, adding GBP12.7 million to Reabold’s kitty.

Reabold signed a conditional sale and purchase agreement (SPA) for a cash consideration of GBP250,000 to acquire Corallian’s working interest in all the non-Victory licences. For more details about the Corallian development, click here.

West Newton: Progressing towards development

The current geopolitical uncertainty in the global gas market makes the West Newton project very appealing to Reabold as the latest competent person's report (CPR) revealed that it had the potential to fulfill daily gas demands of 380,000 homes for several years.

The technical testing results support West Newton's strong economic and strategic value. Even the CoreLab analysis demonstrated an actual reservoir fluid flow through several reservoir samples.

Reabold has a 56% stake in the West Newton project, where the company is planning drilling and production at the A site. Additionally, the company has been granted a time extension to allow further exploratory drilling at the B site. The company has planned to drill the first appraisal well in 2023, as part of its phased investment program strategy to considerably de-risk the project.
Source: Company’s update

The project holds an estimated 86% geological chance of success based on the CPR published post the reporting period. It also confirms gross 2C unrisked technically recoverable resources of 197.6 billion cubic feet (bcf) of sales gas.

Developing a significant stake in OTC-traded oil and gas operator

Reabold has converted its drilling and production success in subsidiary ‘Reabold California LLC’ into a major stake (42%) in California-based Daybreak Oil & Gas Inc ("Daybreak") via an equity exchange agreement. The development, as per the company, helped generate liquidity and form a new, cash flow-producing business with good growth prospects. For more insights into the story, click here.

Financial footing

For the period, Reabold has spent GBP451,000 on capital expenditure, which includes GBP125,000 at West Newton, and GBP250,000 for the acquisition of six exploration licences from Corallian. The company's net cash stood at GBP3.6 million on 30 June 2022, with no debt.

What lies ahead?

Reabold has planned to develop its West Newton project by continuing preliminary work on the West Newton development well. Sale proceeds from Corallian enhance the funding capacity. Furthermore, the company continues to work on numerous opportunities with an eye on growth.


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