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Rose Petroleum seeking approval for Mexico mill disposal, potential equity fund-raising, share consolidation

Published: 00:39 02 Sep 2017 AEST

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Rose plans to sell the mill to Magellan Gold Corporation for a total consideration of US$1.5mln

Rose Petroleum PLC (LON:ROSE) is to seek shareholder approval for a proposed disposal of its mineral processing mill operation in San Dieguito de Arriba, Mexico, as well as the authority for a potential equity fund-raising  and a 100-for-1 share capital consolidation.

In a statement, the AIM quoted natural resources group said it plans to sell the San Dieguito de Arriba mill and its associated assets, licenses and agreements to Magellan Gold Corporation (OTCQB:MAGE) for a total consideration of US$1.5mln.

The consideration is payable as US$1.0mln in cash - less a US$100,000 option payment already received - and US$500,000 in restricted common stock in Magellan.

READ: Rose Petroleum finalises seismic plans as it readies for kick-off

Rose said it also needs shareholder approval to increase the company's share authorities in order to provide it “with the flexibility to act quickly in the case of an opportunity to conduct an equity fundraising, should this be required.”

As previously announced, the company is in dialogue with a number of third parties regarding additional potential funding options for both the recent 3D seismic survey and the subsequent drilling programme at the Paradox Basin oil and gas exploration acreage, Utah, which it said today may involve an equity fundraise.

The company will hold a general meeting at 11.00am, on 18 September 2017 at the offices of Allenby Capital Limited in London to seek approvals for the disposal, potential equity fund-raising authority and a capital reorganisation which will replace 100 existing ordinary shares in the firm with one consolidated share.

In late afternoon trading, Rose shares were 4.8% lower at 0.10p.

Paradox seismic survey now completed

Yesterday, Rose told investors that the design for an upcoming seismic survey in the Paradox basin has now been completed and the operations are expected to start within a matter of days.

It added that there will be a reduction in the scale of the survey, which will keep costs down.

Matthew Idiens, Rose’s chief executive said yesterday: “Reducing the shoot area to 40 square miles whilst retaining the same coverage of our acreage has enabled a significant reduction in costs without affecting the quality of the data.

“Surveying work is expected to commence within days which will keep us on track for completion of the shoot by year end.”

Rose Petroleum announces CPR results for Paradox basin in Utah

Matthew Idiens, chief executive officer of Rose Petroleum PLC (LON:ROSE) tells Proactive that the company has presented a new competent person's report (CPR) assessing its Paradox basin in Utah, United States. “We’ve put a lot of effort into the geological assessment and these were...

on 22/6/18