RNS Number : 5783I

Baron Oil PLC

19 April 2022


19 April 2022

Baron Oil Plc

("Baron Oil", "Baron" or the "Company")

Request for Relinquishment of Licence Block XXI, Peru

Baron Oil (AIM: BOIL), the AIM-quoted oil and gas exploration company, announces that, through its fully owned subsidiary, Gold Oil Peru SAC, it has requested the relinquishment of its legacy Licence Block XXI in Peru (the "Licence").

As previously outlined, the Licence has been largely under Force Majeure ("FM") for a variety of reasons since 2017 and Baron has been frustrated in its attempts to access the area in order to carry out operations. In our Interim Report of September 2021, we set out four requirements necessary to progress the project, which were:

   --    confirmation that a three-year extension option to the Licence is available; 
   --    attracting a local farm-in operating partner; 
   --    freedom to conduct workshops with the local communities; and 

-- drilling authorisation at the local level from, amongst others, the regional president and council.

Regrettably, none of these criteria have been met.

Under the terms of the Licence Agreement, if the Licence is currently under FM and has remained so for a continuous period of more than 12 months, as is the case, the Licence holder may ask Perupetro SA (the Peruvian national Oil & Gas Agency and Licensing Authority) to release the licensee's Bank Guarantee, which in this case is US$160,000. Thereafter, there will be a requirement to establish and file an Abandonment Plan for approval by the relevant authorities.

Andy Yeo, CEO of Baron, commented:

"Over the last year or more we have worked hard to pivot the Company towards assets where we have significant interests in meaningful and active opportunities.

On the Chuditch TL-SO-19-16 PSC, offshore Timor-Leste, we have a 75% interest in a gas discovery and associated prospects and lead that have an aggregate gross Pmean prospective resource of over 590 MMboe independently validated to the SPE PRMS 2018 standard.

In the UK we have accelerated progress and increased our interest to 32% by executing a farm-up agreement in the P2478 licence containing the "Dunrobin" prospect with an internal, non SPE PRMS 2018 standard, estimated gross Pmean prospective resource of the order of 100 MMbbl.

In both cases, we are making good progress on the respective seismic re-processing projects and other technical studies with results to be announced later this year. In 2023 there will be the potential to be drilling at Chuditch and a drill or drop decision on Dunrobin. By contrast, Peru Block XXI has a materially smaller prospective resource with no certainty around pathways or timelines to drilling, hence the Company's decision to relinquish the Licence and ultimately withdraw from the country."

Qualified Person's Statement

Pursuant to the requirements of the AIM Rules -- Note for Mining and Oil and Gas Companies, the technical information and resource reporting contained in this announcement has been reviewed by Jon Ford BSc, Fellow of the Geological Society, Technical Director of the Company. Mr Ford has more than 40 years' experience as a petroleum geoscientist. He has compiled, read and approved the technical disclosure in this regulatory announcement and indicated where it does not comply with the Society of Petroleum Engineers' standard.

For further information, please contact:

Baron Oil Plc                                                       +44 (0) 20 7117 2849 
Andy Yeo, Chief Executive 
Allenby Capital Limited                                             +44 (0) 20 3328 5656 
Nominated Adviser and Broker 
Alex Brearley, Nick Harriss, Nick Athanas (Corporate 
 Kelly Gardiner (Sales and Corporate Broking) 
IFC Advisory Limited                                                +44 (0) 20 3934 6630 
Financial PR and IR 
Tim Metcalfe, Florence Chandler 
 PMean                Reflects a mid-case volume estimate of 
                       resource derived using probabilistic methodology. 
                       This is the mean of the probability distribution 
                       for the resource estimates and may be skewed 
                       by high resource numbers with relatively 
                       low probabilities. 
 MMbbl                Million barrels (either oil or condensate 
                       liquids associated with gas, depending 
                       on context). 
 MMboe                Million barrels of oil equivalent. Volume 
                       derived by dividing the estimate of the 
                       volume of natural gas in billion cubic 
                       feet by six in order to convert it to an 
                       equivalent in million barrels of oil and, 
                       where relevant, adding this to an estimate 
                       of the volume of oil or condensate in millions 
                       of barrels. 
 Prospective          Quantities of petroleum estimated to be 
  Resources            potentially recoverable from undiscovered 
                       accumulations by application of future 
                       development projects. 
 SPE PRMS 2018        The Society of Petroleum Engineers' ("SPE") 
                       Petroleum Resources Management System ("PRMS"): 
                       a system developed for consistent and reliable 
                       definition, classification, and estimation 
                       of hydrocarbon resources prepared by the 
                       Oil and Gas Reserves Committee of SPE and 
                       approved by the SPE Board in June 2018 
                       following input from six sponsoring societies: 
                       the World Petroleum Council, the American 
                       Association of Petroleum Geologists, the 
                       Society of Petroleum Evaluation Engineers, 
                       the Society of Exploration Geophysicists, 
                       the European Association of Geoscientists 
                       and Engineers, and the Society of Petrophysicists 
                       and Well Log Analysts. 

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April 19, 2022 05:00 ET (09:00 GMT)

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