Block Energy receives additional funding for Georgia drilling project
(WO) – As announced on February 2, 2023, Block Energy plc, the production and development company focused on Georgia, closed a senior secured loan facility of $1.06 million (c. £0.86 million on February 2, 2023).
The Loan Facility permitted the company to borrow an additional contingent amount of up to $2 million during the term of the loan from the $1.06 million already committed, with the existing lenders having a right of first refusal for a period of 20 business days to participate in any extension.
The company has now increased the Loan Facility by $0.94 million (c. £0.75 million on May 10, 2023), and entered into an updated Loan Agreement, with the only changes made to reflect the increased amount of the Loan Facility and to allow new lenders to participate in the current tranche, together with those of the existing lenders who have elected to participate.
The funds raised will provide liquidity to maintain momentum around scheduled crude liftings, allowing the company to accelerate the procurement of materials for the drilling of its next Project I wells. The first in the drilling sequence is KRT-45Z, located approximately 1,500 meters from the recently drilled and successful WR-B01Za well and will be spud in July.
Commenting, Phil Dimmock, Chairman of Block Energy plc, said, “Existing Group production is now over 620 boed (April average rate), and it is important that we keep the momentum going with the drilling campaign. The success of both JKT-01 and WR-B01Za has given us great confidence as to the full potential of Project I. These additional funds assist in the timely procurement and execution of the next development wells.”
The further $0.94 million is being lent on the same terms as the initial Loan Facility, that being for a term of 18 months from the date on which the Loan Facility was initially drawn down, at which point the principal is repayable in full. The Loan Facility carries an interest rate of 16% p.a., payable quarterly in arrears in cash. The company may elect to repay amounts outstanding under the Loan at the end of each quarter, in part or in full, subject to a 2% early repayment fee concerning the outstanding principal amount.
The company’s Chief Executive Officer, Paul Haywood, has provided a further $25,000 of the Loan Facility (in addition to the $90,000 already committed). Its current Chief Operating Officer and former board director, Ken Seymour, has provided a further $25,000 of the Loan Facility (in addition to the $100,000 already committed).
