Cameroon Financing Update
21 November 2022
Tower Resources plc
("Tower" or the "Company")
Cameroon Financing Update
Tower Resources plc (AIM: TRP.L), the Africa-focused energy company, is pleased to provide an update on its financing activity in respect of its Thali Production Sharing Contract (PSC), in the Rio Del Rey sedimentary basin offshore Cameroon.
Tower is pleased to announce that its subsidiary, Tower Resources Cameroon S.A ("TRCSA"), has been notified by BGFI Bank Group ("BGFI"), the largest bank group in Central Africa, that the medium term loan of approximately US$7 million for which TRCSA and BGFI agreed a term sheet at the end of June 2022 (the "Loan"), has been approved by the credit committee of the Cameroon bank. Further approval is still required at the BGFI group level and discussions are now turning to the details of the structure and documentation, as well as a potential modest enlargement of the facility.
Whilst the Company aims to complete these discussions as quickly as possible, it cannot be certain of when final approval will be received, if it is successful.
As previously disclosed, the Loan should cover around 40% of the approximate US$18 million cost of the well, with a further amount of 25% already having been paid for by TRCSA. The balance of 35% of the cost of the well is also to be funded by TRCSA. This balance may be funded by further financing at the asset level, or with corporate funds.
The Company is continuing to discuss additional financing options at the asset level, including with BGFI. The Company's current plan is to complete the Loan financing documentation, if possible, before seeking to conclude any further bank discussions.
Jeremy Asher, Tower's Chairman and CEO, commented:
"We are very happy with the progress in our discussions with BGFI Bank Group, and the support that the local bank has shown towards our project in Cameroon.
"Discussions regarding the rig options with suppliers and other operators are also continuing as expected. As previously announced, long lead items for the well have already been purchased, and the environmental and social impact assessment, site survey and site debris survey are complete. Therefore, we are in a position to move quickly once a rig slot is finalised.
"We remain very confident that we will be able to drill the NJOM-3 well in good time and thank our shareholders for their patience while we seek to conclude these discussions."
Market Abuse Regulation (MAR) Disclosure
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ('MAR'). Upon the publication of this announcement via Regulatory Information Service ('RIS'), this inside information is now considered to be in the public domain.
Tower Resources plc
Chairman & CEO
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BGFI Bank Group is a large financial services conglomerate in Central, West and East Africa, with subsidiaries in ten countries, including Gabon, where the Group was founded, and Cameroon. The member institutions serve both individuals and businesses, with emphasis on small-to-medium enterprises (SMEs). As of December 2020, the Group's assets were in excess of €5 billion, and BGFI Bank Group is described as the largest bank group in Central Africa (the CEMAC zone).
About Tower Resources
Tower Resources plc is an AIM listed energy company building a balanced portfolio of energy opportunities in Africa across the exploration and production cycle in oil and gas and beyond. The Company's current focus is on advancing its operations in Cameroon to deliver cash flow through short-cycle development and rapid production with long term upside, and de-risking attractive exploration licenses through acquiring 3D seismic data in the emerging oil and gas provinces of Namibia and South Africa, where world-class discoveries have recently been made.
Tower's strategy is centred around stable jurisdictions that the Company knows well and that offer excellent fiscal terms. Through its Directors, staff and strategic relationship with EPI Group, Tower has access to decades of expertise and experience in Cameroon and Namibia, and its joint venture with New Age builds on years of experience in South Africa.