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ADM Energy plc ( (GB:ADME) ) has provided an update.
ADM Energy has formed Vega Upstream JV, LLC with Covenant Oil Group to pursue U.S. onshore oil and gas deals and agreed to acquire Midcon Assets in Oklahoma for about $14.9 million, funded largely by debt and $1 million of equity of which ADM will contribute roughly $100,000. Through the joint venture, ADM will hold 50% of the JV’s membership and voting rights, a 10% direct interest in the Midcon Assets, an option to raise its JV stake to 35%, and access to expected annual net revenue of about $850,000 plus operator fees and a $300,000 acquisition fee.
The Midcon package spans interests in 28 operated and around 250 non-operated wells, three drilled but uncompleted wells, 58 potential drilling locations, and a fee-generating gas gathering system moving 4.4 mmcf/d for ADM’s assets and third parties. Additional upside could come from consultancy income linked to a participation option granted to Electric Guitar PLC, operating and marketing fees at the JV level, and service revenue of up to $90,000 per month for ADM’s Eco Oil subsidiary, potentially transforming the company’s production base and recurring cash flow profile in the U.S. market.
More about ADM Energy plc
ADM Energy PLC is a natural resource investing company listed on London’s AIM and German exchanges, focusing on upstream and midstream oil and gas opportunities. The group targets producing assets and infrastructure, with a growing emphasis on U.S. onshore projects and service-based revenue through subsidiaries such as Eco Oil Disposal.
Average Trading Volume: 4,709,393
Technical Sentiment Signal: Sell
Current Market Cap: £639K
Learn more about ADME stock on TipRanks’ Stock Analysis page.