U.S. Oil & Gas plc - Update
PR Newswire
London, October 28
October 29, 2021
U.S. Oil & Gas Plc.
("US Oil" or the "Company")
Update
U.S. Oil & Gas Plc, ("USOIL" or the "Company"), the oil and gas exploration company with assets in Nevada, makes the following announcement:
Permit application
As previously reported, three drill permit applications are currently in process with the Nevada Bureau of Land Management (BLM). However, no indication has yet been received concerning a time-scale for permits to be finalised. The Board continues to believe that if permits were to be awarded without undue delay, sufficient time remains to drill a funded well or wells before the leases concerned expire. The Company is also exploring the possibility of seeking lease extensions on multiple material grounds.
Funding
Currently, the Company is actively engaged in fundraising. Whether or not sufficient funding can be raised to drill within the required time frame is as yet uncertain. The Board believes that the award of a permit or permits, if that should occur within the required timeframe, would materially increase the chances of successful fundraising.
Strategy
The Board has carefully considered the Company's options in the event that funds are not raised soon enough to allow sufficient lead-in time for a drill on the leases set to expire in the near term. Although certain leases will expire if drilling does not take place, other prospective leases will still be held by the Company. Leases held include 52,046 acres impacted by a court-ordered suspension of operations on federal leases in Wyoming, Utah and Nevada, as previously reported. This suspension may in time be lifted and allow operations to continue. The Board intends that the Company remain positioned for as long as possible to take advantage of that situation should it arise. In addition, the Company holds two leases totalling 1,223 acres, considered highly prospective, that are not constrained by the court order and that do not expire until 2030. Given the required funding, the Company would engage in exploring those leases to appraise prospects for drilling.
The Board's overriding strategy will be to position the Company so it can take advantage of any positive developments and opportunities that may arise over the longer term. To that end, a contingency plan has been developed that includes curtailing the Company's operations by reducing equipment holdings, storage facilities and other overheads, including personnel costs. Core corporate activities, including audit, regulatory and legal functions will continue.
Brian McDonnell, US Oil CEO, said:
"US Oil has discovered an active oil system in Hot Creek Valley, and the Board believes that a major oilfield is there and waiting to be proved up. While we still await permits to proceed with drilling on our West Play leases, the Company has been actively engaging with potential investors. As we have said, sufficient lead-in time remains to drill a well or wells before the relevant leases expire.
"If it should happen that funding cannot be raised in time to drill the wells for which permits have been sought, the Company will continue to seek investment in order to explore its remaining leases. The Board has carefully considered the Company's options and has decided that priority should be given to keeping the Company positioned to take advantage of any positive developments. Changes in the funding situation, lease conditions or the wider regulatory environment could materially improve the Company's prospects. To that end, a contingency plan for reducing Company activities and overheads has been drawn up and approved by the Board and will be implemented at the appropriate time and as circumstances dictate.
"In an environment in which oil prices are rising and predicted to rise further, I believe it is in the interests of shareholders that the Company continues to explore Hot Creek Valley over the longer term. Data from our three wells fully support the view that US Oil has discovered an active oil system in the valley. All indications are that a major oilfield is there to be proved and developed. Right now, excellent targets are waiting for the drill bit."
FORWARD-LOOKING STATEMENTS
The statements in this communication reflect the current thinking of the Board and the Company's present plans. The Company reserves the right to alter plans in the light of developing knowledge and circumstances. Shareholders' attention is drawn to the note below concerning Forward-looking Statements.
This press release contains certain "forward-looking statements" and "forward-looking information". Forward-looking statements and forward-looking information include, but are not limited to, statements with respect to: business plans and strategies of US Oil and Gas; operating or technical difficulties in connection with drilling or development activities; availability and costs associated with inputs and labour; drilling and exploration costs; the speculative nature of oil exploration and development; diminishing quantities or quality of reserves; synergies and financial impact of completed acquisitions; the benefits of the acquisitions and the development potential of properties of US Oil and Gas; the future price of oil; supply and demand for oil; the estimation of reserves; the realization of reserve estimates; costs of production and projections of costs; success of exploration activities; capital expenditure programs and the timing and method of financing thereof; the ability of US Oil and Gas to achieve drilling success consistent with management's expectations; net present values of future net revenues from reserves; expected levels of royalty rates, operating costs, general and administrative costs, costs of services and other costs and expenses; expectations regarding the ability to raise capital and to add to reserves through acquisitions, assessments of the value of acquisitions and exploration and development programs; geological, technical, drilling and processing problems; treatment under governmental regulatory regimes and tax laws.
All statements other than statements of historical fact are forward-looking statements
THE DIRECTORS OF THE COMPANY ACCEPT RESPONSIBILITY FOR THE CONTENTS OF THIS ANNOUNCEMENT
Neither this announcement nor the information contained herein constitutes an offer or solicitation by U.S. Oil and Gas Plc for the purchase or sale of any securities nor does it constitute a solicitation to any person in any jurisdiction where solicitation would be unlawful.
For further information contact:
Brian McDonnell, Chief Executive Officer +353 (1) 631 9022
About U.S. Oil & Gas:
U.S. Oil & Gas plc is an oil and gas exploration company with a strategy to identify and acquire oil and gas assets in the early phase of the upstream life-cycle and mature them. The Company's
main asset is in Nye County, Nevada where it holds the entire share capital of US-based company, Major Oil International LLC ("Major Oil"). Major Oil has acquired rights to exploration and development acreage in Hot Creek Valley, Nye County, adjacent to the oil and gas rich Railroad Valley area of Nevada, both of which are part of the Sevier Thrust of central Nevada and western Utah, USA.
For further information please refer to our website at: www.usoilandgas.us
