Strategic Acquisitions Expand Ascent Resources' US Oil and Gas Portfolio

Ascent Resources has acquired significant interests in oil and gas leases in Colorado and Utah. The company plans to implement cost-saving measures, appoint a new CEO, and raise funds to support these ventures. These strategic moves are expected to enhance Ascent's operational capabilities and market positioning, potentially benefiting stakeholders through increased production and resource development.

Ascent Resources plc (LON: AST) has made significant strides in its oil and gas exploration and production (E&P) strategy with the announcement of conditional acquisitions in Colorado and Utah, along with a series of financial and operational initiatives. The company has entered into agreements to acquire non-operated interests in producing oil and gas leases, while also planning to appoint a new CEO, implement cost-saving measures, and raise funds to support these ventures.

Conditional Acquisitions

Ascent Resources has signed agreements to conditionally acquire a 49% direct non-operated interest in producing oil and gas leases in Colorado, owned and operated by Locin Oil Corporation. The total consideration for this acquisition is $2.5 million, with $600,000 worth of shares to be issued at a price of 0.5p per share, subject to shareholder approval. Additionally, a $1.9 million 3-year term convertible loan note will be issued to the vendor. In Utah, Ascent has agreed to acquire an initial 10% direct non-operated interest in oil and gas leases owned and operated by ARB Energy LLC for a total consideration of $750,000, satisfied by the issue of new shares at the Placing Price.

New CEO Appointment and Board Changes

Ascent Resources plans to appoint David Patterson, a US-based geologist and experienced oil and gas explorationist, as Chief Executive Officer following the next Annual General Meeting (AGM), subject to the completion of customary director onboarding checks and other conditions. This move is part of the company's broader strategy to enhance its operational capabilities and market positioning.

Cost Savings and Fundraising

To support its new ventures, Ascent Resources has announced plans to implement cost-saving initiatives, including a 30% reduction in the cash component of salaries for directors and C-suite executives over the next six months. The company also intends to raise funds through a new fundraising round, with gross proceeds of £1.35 million ($1.8 million) at 0.5 pence per new share, representing a 41% discount to yesterday's closing price of 0.85 pence per share. Additionally, the company has appointed Shard Capital and Fortified Securities as joint brokers.

Debt Reprofiling

Ascent Resources plans to partially redeem senior lenders and re-profile its outstanding balance, including extending the maturity by two years and setting a fixed conversion price at 1 pence per share, representing a 100% premium to the new equity price.

Outlook

These strategic moves are expected to enhance Ascent Resources' operational capabilities and market positioning, potentially benefiting stakeholders through increased production and resource development. The company's focus on helium-rich gas assets and the evaluation of well-head AI data centers further underscores its commitment to innovative and sustainable energy solutions.

References

[1] Reuters. (2025, May 22). Ascent Resources plc: Conditional Acquisition of New Interests in Colorado & Utah Upstream Portfolios, New Fundraising, Debt Reprofiling, Board Changes and Cost Savings. Retrieved from https://www.tradingview.com/news/reuters.com