Reabold Resources (LSE:RBD) — Introduction to Reabold Resources

0:01 Good morning, and welcome to the introduction to REABOLD RESOURCES PLC investor presentation. Throughout this recorded presentation, the investors will be in listen only mode. Questions are encouraged and can be submitted at any time via the Q and A tab situated on the right hand corner of your screen. Click q and a, scroll to the bottom, type your question, and press send. Company may not be in a position to answer every question received during the meeting itself. However, the company review all questions submitted today, and we'll publish responses where appropriate to do so. Before we begin, we'd like to submit the following poll. I'd now like to hand you over to Steven Williams and Satchinoza, co chief executives of REABOLD RESOURCES PLC. Good morning. Thanks very much, Paul. Welcome, everybody, that's taking interest today, in this post gonna be basically an introduction to, to REABOLD RESOURCES. I will start off with a little bit of background, because I'm aware there's probably some people on today that are that are new to the company. So forgive me if this is, something that you heard before for those that are already following REABOLD.

0:58 But if we take a step back and think about really what the the business model behind REABOLD really is and and and why

1:03 we got started with this project is that, you know, we'd identified, a situation that have emerged in the upstream oil and gas industry where we we believe we could identify some very interesting, high quality, attractive upstream projects typically in the free cash flow phase of their life cycle. But it becomes stuck generally due to a lack of capital, sometimes due to, being approached in what wasn't necessarily the most effective, strategic manner. And we felt that there was an opportunity to provide capital to try and unlock some of those projects by drilling wells and altering the strategy somewhat, to enable them to go forwards in what was a a a tight environment for attracting, attracting significant amounts of capital.

1:52 And so we identified a number of projects that we brought into the REABOLD portfolio to give us a a diversified portfolio of upstream oil and gas opportunities, where we have been able to deploy cash, drill wells, and start to take those projects forward, whereas otherwise, they would have been left stranded. I think it's, before we go on to the portfolio itself, I think, you know, it's a really interesting time in the evolution of the company, because we're getting to the point where, across our project portfolio, we're really starting to to get the sense that we've taken these projects to a to a level where we can start to think about the next phase beyond what I just described as our business model. So whereas we've always looked at projects as things that we would deploy cash into to unlock and move forward, we're now getting to the point where we're really starting to define what we've got in some of these project areas, and they're ready to be taken into the, to the point of development.

2:43 And that is a really interesting point for us because that opens up all sorts of opportunities to either put these things into production, develop them, and generate cash from them, or to potentially look at various forms of exit for REABOLD and then to potentially redeploy capital into new projects and sort of recycle the portfolio in that manner. Now each of the different project areas is at a slightly different stage in it in its life cycle, and and we'll run through that, in a bit more detail in a minute. But across the portfolio, that's really where we're starting to get to. So for we had a number of years where we've been taking cash from the equity market, deploying them into projects, and drilling wells. And as I say, we're now hitting that inflection point where we're starting to get to a position of potential development or or monetization or other forms of of of exit from from some of these projects.

3:29 So on this slide here, there's a very brief overview of the REABOLD portfolio. We have really four different, project areas. We've got onshore, UK, where we have the West Newton project and the surrounding area where there's significant, follow on potential to West Newton. And the data that we have so far suggests that West Newton is, is the largest UK onshore hydrocarbon discovery since 1973 when which farm was discovered, and is a really significant resource, well positioned onshore

4:00 UK. We have our UK offshore portfolio, which we access by our ownership in in the private e and p company Coralian. And in particular, we have a very interesting project there called Victory, which really is in the development phase now. We have our onshore Romania interests by Danube Petroleum, and we have direct license interests in California where we've drilled a number of wells and are producing today. So that's really the the snapshot of the portfolio. I'll I'll hand over to Sachin to start talking through some of these areas in a little more detail. Great. Thanks very much for that, Steve. So, essentially, as we run through the portfolio, it this should and and we'll demonstrate how it plays out to all of the points that Steve raised in terms of the execution of our strategy.

4:46 A lot of what we run through, though, will be based on essentially this introductory piece as well and or a reminder of where we are with each of the project areas. So if we kick off with that, we, first of all, look at the victory project and an overview of this. So, again, as a reminder, this is a project we have access through via our interest in Coralian Energy. And Coralian have and were awarded 100% of the license in which Victory is. And Victory itself is is is a gas development project is really a a relatively simple and low risk project, and many of the attractions associated with it is not only the geological being geologically low risk, but also its position in terms of access to infrastructure in order to move that in order to move the project from where it is now ultimately into production.

5:48 Critically, as part of the pathway for the asset and field in terms of where it is now, moving towards that period of of production is this phase of submitting a field development plan to the oil and gas authority, and that was done at the draft field development plan was submitted in December 2021. And that really, as I say, underpins the value and intrinsic low risk nature of being able to move this asset towards the value recognition phase. The actual asset itself is is a significant scale with a 179 BCF of two c contingent resources estimated by, an RPS CPR, and the actual valuation of of Victory based on 50p a firm is a £193,000,000, and and clearly net to us with that 50% interest is £96,000,000.

6:48 And, again, just emphasizes not only the nature of the significant value, but also the low risk nature of that asset. Importantly, what we are moving towards in the current environment of a transition towards net zero and maximizing economic recovery as being a key strategic element that the OGA is looking for for these projects is also being borne out inherently by the nature of of the Victory project. So a little bit more color associated with the asset. So this is in the West Of Shetlands, and the actual subsurface geological bit that I've mentioned earlier is borne out by being high quality in terms of the fact that the reservoir itself is a very good quality clean reservoir with good quality and lean gas associated with an area that is relatively low shallow water for the West Of Shetlands.

7:53 We'd already mentioned the fact that this is a significant resource from the actual volumetric point of view and also from a value point of view. The fact that the draft FDP was submitted is clearly a key milestone as we move this asset towards the monetization phase. But alongside that, we are looking for the looking to concurrently work with the submission for the environmental statement for later this month. The map that you see here on the right hand side of this slide is really an indication again of the abundance of infrastructure where there is spare capacity that Victory can tie into. And Victory is the field located in the yellow box in in this West Shetland area, and as I indicated, is attractive not only for the reasons mentioned from a subsurface point of view, also from an access to infrastructure point of view.

8:54 The reason that that's important not only from the economics and value argument, but also from the two other elements that are key strategic objectives of the OSGA are the transition to net zero and the maximizing of economic recovery. So in this transition to net zero, we have a field that is below The UK average of green of c o two emissions over the life of the project, significantly so, and the fact that this is a single well development that we're looking at that has a low footprint associated with those greenhouse gas emissions. In addition, there are longer term potential capability for, for instance, the reuse of the facility for carbon capture and storage, which is a longer term objective for this transition to net zero by the OGA.

9:49 Now many of the points that we've just highlighted here in terms of that transition to net zero also play into the maximizing of economic recovery, particularly as it relates to the access to infrastructure that is nearby and maximizes the use of that infrastructure in which is there in which there is spare capacity. So all of that, as I say, plays into the idea that we have a field here that has good quality resource from a subsurface and volumetric point of view, high value, but it's also been moved through this phase of the development part of of of the the the studies and the work, ultimately, such that we can move this asset to the point of monetization and value recognition for REABOLD and its shareholders.

10:38 So that's the victory project. As I say, highlights many of the points that Steve had raised in the strategic objectives that REABOLD has. The other key project area that is very significant is the West Newton discovery that was made. So quick reminder about West Newton. This is an onshore license area called Pedal 183 located near Hull in the Northeast Of England. So there have been three wells on the West Newton field confirming this to be a significant onshore discovery and potentially one of the largest discoveries onshore in The UK since which farm. But equally importantly, and again, echoing many of the features that we saw with Victory is that this field is ideally suit suited for being able to move it into the monetization phase because it has access to so much infrastructure from an oil and gas point of view.

11:36 We are permitted for a a further well at the b side, and currently, we are underway with planning for a multi well development plan program at the West Newton sites that we currently have. So the testing operations that have taken place at the back end of last year confirm the view that horizontal wells can deliver significant potential from this field from a production profile point of view, and we'll talk about that in a little bit more detail later on. So this is a little bit more color associated with that infrastructure nearby. So you see the West Newton Field in the map in the center here along with the locations of the two sites at which we drilled West Newton A and sorry. I beg your pardon. Where we the two discoveries at the West Newton A site, the a one and the A 2, and you see the outline for the West Newton Field itself.

12:39 But alongside that, not only on the license area, but just off the license area, we have a series of sites and infrastructure that are all suited and geared towards the oil and gas industry. These include things like the Lindsay oil refinery, the Humber Refinery, the Dimmington Terminal, gas storage facilities, and chemical plants where feedstock of natural gas is is a significant element of the operations of those sites. So it's an area that has an abundance of the of hydrocarbon related activity as well as the infrastructure in order to be able to transport that hydrocarbon the hydrocarbons in and around those various facilities. So from that point of view, West Newton is extremely well positioned in order to move it through that monetization phase of its life cycle and development phase of its life cycle.

13:31 So on this slide here, we'll talk a little bit more associated with the actual subsurface elements of West Newton. The map over here to get your eye in is really sort of showing the anomaly that is the West Newton anomaly, which is quite a large feature, and the two sites at which we have current operations, which are the West Newton A sites and the West Newton B sites. And the wells that have been drilled have been two wells on the West Newton A site, being West Newton A one and a two, and a well that was drilled on the b site.

14:07 So the first thing to mention just in relation to that activity is the fact that the discoveries were made across this significant anomaly that we'd seen and confirmed the hydrocarbon column across a very large area strongly supports the view that we have an ex aerially extensive and continuous field that is this West Newton Field underpinning the the the the again, the view that this is one of the most significant discoveries made onshore, potentially the largest discovery made since which farm. Now as we've gone through the process of of drilling and testing wells, and frustratingly, we did not get a sustained flow rate out of either the a well or the b well. But in the subsequent work that had taken place culminating in a a piece of work done by RPS, it indicated that significant flow potential was capable from an optimized well. And an optimized well was likely to be a deviated or horizontal well that intersected a a greater portion of the the pay zone within the West Eton Field.

15:23 We'd always had the view that optimized wells of this nature would be required in order to exploit and extract hydrocarbons from this field. And I think the confidence that we've had despite not getting sustained flow from the flow test, but the work that had taken place since then really underpins our confidence in the ability to extract significant value from the West Newton resource.

15:53 The other thing associated with the optimization program that had been undertaken by RPS that looked at us a significant dataset, including the well logs that we have, the core data, and so on, was the optimized completion necessary in order to maximize flow potential from these wells. And I think that is the second piece that plays very much into the underpinning of our confidence that this significant resource can be monetized and demonstrate significant value. So the key metric, I think, there that that that that helps put some color around that is that an optimized well on this field is likely to be able to deliver something like 5,900 barrels of oil equivalent a day of production, and that was calculated for the first month's average daily production rate.

16:50 And although we don't have the fully fledged economics borne out by that, I think it strongly underpins a robust commercial case for this asset. So those are the two key ones that I think that we have the near term operational activity and work that

17:09 and workflow that had been moving those two assets forward. But, also, what's been taking place is corporate activity as associated with REABOLD California. But before moving on to what that corporate activity is, let's just have a quick reminder of what the asset position is. And the asset position we have was two key license areas, West West Brentwood and Monroe Swell in Sacramento Basin in California. And these two assets, when when we have all got involved, did not have any production on them at the time. There was a slew of historical wells and indeed three d seismic data that gave us a strong degree of confidence that we would be able to drill wells and get them into production.

17:54 And since that time, we've had five wells drilled across the two license areas. They're on production, generating cash flow, and again, is a demonstration of this ability to take free cash flow assets, and in this case, move it to monetization through the process of putting it on production. However, what we focused on in the California area is this idea that we are really able to also use REVOLD California to create a larger entity that is California focused with the aim and ambition of growing that business, particularly in the current environment, with the attraction of US based investors recognizing the value inherent in such an opportunity.

18:39 So what we've done is and and what we've announced is that we will be merging our REABOLD California operations with Daybreak Oil and Gas, a California focused entity, alongside

18:53 the raising of capital, which will allow the further drilling of activity on both the Daybreak license areas and the WEIBOLD California license areas. That will mean that WEIBOLD cap that WEIBOLD PLC will end up with shares in a clean, high growth, well positioned company that will be able to exploit and and and pursue the number of significant value opportunities that we see in California. The deal itself is planned to close in late April, and the yeah. There's a reason why the timeline has progressed in the way that it has, and it's associated with the fact that Daybreak Oil and Gas itself has had to go through a series of of its own capital restructuring before REABOLD was comfortable that it was in a position to be a clean company to move forward.

19:50 And largely, Daybreak Oil and Gas has gone through that those pieces of it, and so we're in the last elements associated with the regulatory requirements to have this deal closed in late April.

20:06 K. So the final area is Danube Petroleum, and this is an asset position that REABOLD has in in Romania. And the Romanian position is held through the parts of license that we have onshore, and this is in an area that has been a significantly significant producing basin for a long period of time. There are multiple leads and prospects of both oil and gas on this license area, And, we are both or Danube had made the initial iMIC one gas discovery. And what we are doing currently is looking at that discovery alongside the potential resource scale that it has in order to determine the best way to move forward with with the project.

20:59 So we, again, here had a lack of significant gas flow

21:05 from this license from the IMIK one well, and there are a number of actions that we can take going forward in order to determine the best way again to lead to, know, extract monetization or extract value from this from this field. Now we have technical studies going on currently,

21:27 and Daniel is really evaluating what the lowest risk way is to take forward the opportunity that we see and have currently derisked within Romania. And as we get further down the track in terms of determining exactly what that program is, then we'll come back to the market with a well defined work program for what what what the remaining opportunity looks like. It is a frustration that we were not able to get that flow rate from this well, but we strongly believe that there are a number of ways we can move forward. And that, I think, is what we will come back to the market with. And from that point of view, we'll be able to demonstrate where the value creation points are and value opportunities are within within Danube.

22:20 So I think that essentially is a run through of the entire portfolio in part an introduction, in part an update of of of where we are. I think we, right now, are in extremely exciting time for the company. And the reason I say that is because the early phase of what we've done was to create a portfolio where we had built out assets that would be attractive both to capital markets and to industry. I think the next phase of evolution of this company is to move forward towards towards taking these assets into development and or monetization, and that's where we are now. The reality is probably that that part of the execution of the strategy has taken a little bit longer than we would have ideally liked, and the reason for that has been in no small part because of the difficulties of the of of COVID and coronavirus that had also had the knock on effect of reducing activity and reducing oil and gas prices globally.

23:27 But with that behind us, with the environment that we face being almost exactly the opposite of what we of of that situation that I described, I think we are really very, very well positioned to capitalize on that opportunity set, and the asset package that we've put together is, again, ideally suited to benefit from that.

23:49 Fantastic. Steve and Sachin, thank you very much indeed for the presentation. Ladies and gentlemen, do please continue to submit your questions using the Q and A tab situated on the right hand corner of your screen. Just while the company take a few moments to review those investor questions submitted already, I'd like to remind you the recording of the presentation along with a copy of the slides and the published Q and A can be accessed via your investor dashboard.

24:10 Steven's session, we did receive a number of presubmitted questions, and perhaps I can start off the q and a session with these, if I may. The first one reads, does the company have any update on the reapplication re West Newton? And if so, are they able to provide any guidelines to time scales around decisions to be made?

24:27 Yeah. I'll happy to take that first question. Thanks. Yeah. So we have resubmitted a planning application, which addresses the concerns that were raised the last time around. There is another meeting to be held later this month, which is the next phase of the planning process, and we will update the market as to the outcome of that meeting when it when it happens.

24:52 You know, obviously, we hope for a very quick resolution to this. Sometimes these planning questions take some time. So, you know, fingers crossed that we have some good progress this month. I guess I I would say that we we believe there's a extremely strong case to support a contribution to domestic energy supply given the current macro environment of which we're all, you know, so sort of painfully aware. But as I say, we'll update the market post post the next meeting. That's fantastic. The next question we've got here, bit of a statement as well as a question, I guess. Please could we have the occasional photo stress tweet updates from the site at Rath and Energy throughout the drill at West Newton. This way, we don't have to be fed protester footage, which can be misleading at times.

25:39 Yeah. Okay. Point point noted. Just one thing I would say is when operations are active, particularly during drilling,

25:48 you know, it it it it's quite a sensitive, environment sort of physically, and, you know, the people that are operating are very much focused on getting the operation done effectively and particularly safe safely, and safety is the key consideration there. But saying that point is noted, and we'll we'll definitely take that on board, next time we're actively operating. Great. Thank you, Steven. And, Sachin, you have touched on this, but if there's anything further you can expand on, how confident are the deal with Daybreak Oil and Gas Inc. Will be success successful? The fact that it's been delayed suggests there's possible issues with it. Yeah. Thanks for that question. And and it's it's a fair observation and and and fair question. I think the critical part here associated with the day Daybreak Daybreak transaction and probably the the piece that, we felt, most uncertain about was the ability for Daybreak to recapitalize itself or or to to reestablish its capital structure into something that we felt was more sustainable.

26:51 Now in large part, that has been completed, and they have been successful in that. That has taken a little bit longer than the original timeline we had. But, again, I think I'll critically say that that has at least derisked the process substantially,

27:09 but it's taken longer. So I think the extended timeline doesn't actually, in this case, necessarily mean that it's put the deal at at greater risk, quite the reverse. And the you know, just if if the questioner questioner is following this quite closely, I think one of the most significant pieces was the conversion of the preference shares that Daybreak has its ordinary shares. And that just required Daybreak getting in touch with a number of preference shareholders that, you know, they hadn't

27:42 contacted in for, you know, over a decade. So tracking them down, getting them to vote in favor was time consuming, was a lot of effort, but Daybreak had done a good job in achieving that. So we kept a tight time frame on them. We kept that tight tight time frame on them for a reason, but the fact that they've demonstrated such good progress now leads us to believe it is much more likely that this deal would would conclude than was previously the case. It's worthwhile adding that as maybe the questioner and and

28:13 generally people will know is that that there is a requirement for Daybreak to raise capital as part of this deal. And given the current macro environment associated with hydrocarbons, the need for domestic production, for domestic demand is so strong. I think that the confidence in that side of things has also increased substantially. So all in all, I think we are more confident now. We recognize the timeline has taken longer, but there were good reasons for that. And we think we are actually well positioned

28:44 once this deal closes to really show the value inherent in that combined portfolio and the growth potential going forward. That's great. Thanks, Sachin. The next one we have here is how reliable is the study by RPS group indicating potential for initial production rates of 35,600,000 cubic feet of gas per day? Why do we not see these rates from EWT? Yeah. Should I I start on that one, Sachin? Please jump in because it's it's quite a complicated answer potentially. So to start with, how confident can we be in it? Well, you know, clearly, the precision around the number is not yet known, and it won't be known until until we try it. But is it broadly speaking reliable? I think I think it is, and we're we're very confident in it.

29:29 You know, RPS are extremely experienced in looking at this kind of asset. Now we don't have in within The UK, this is pretty unique as a sort of geological setting, but there are many assets that show these kind of characteristics in other parts of the world, particularly in North America where they do a lot, with tighter, formations. And so, you know, RPS are extremely experienced to this, and they have presented this to us with a with a high degree of of confidence. Right? So we we we are very much reassured following that piece of work and indeed a lot of other technical work that's going on post the tests that we can achieve these rates, which we believe will be highly economic in in any kind of realistic commodity price scenario, never mind the sort of prices we're seeing at the moment. So then, of course, there is an obvious question, why didn't we see that the first time around when we when we tested the two wells, last year? And there are a number of reasons for that that are, becoming apparent as we continue to do the work, on

30:28 the data that came out of that test program. Now one thing in particular, relates to the, the effectiveness of the acidization that was undertaken. Now acidization is absolutely critical to this. We don't think it we've got any chance of flowing this without an effective acid job. And just bearing in mind, you know, one of the key attractions of West Newton is is the thickness. We have a really thick section of pay. And so even though we believe we'll need horizontals ultimately to get the best flow rates, we would have expected to be able to get something out of the vertical well given how thick it was. However, it turns out that the the acid job only appears to have interacted with a very, very thin section of the formation. So the vast majority of the formation was not treated by the acid, and we believe that's a key contributing factor as to why we didn't see the sort of flow rate that we that we would have expected, particularly given the work that r RPS have done more more recently.

31:25 And so part of the solution going forward and part of the work that that's within that r RPS report is a more effective way of completing wells, which will ensure that doesn't happen again. And so we are confident that we can bridge that gap between what we saw in the EWTs last year and what RPS have concluded that we would expect to see given a more better optimized completion. That's great. The next couple of questions, I may just sort of combine in in into one, and I can see, Paul M, thanks again for your question. I'm just talking about the Victory deal. One question reads, will REABOLD benefit from the recent gas price? And if I just tie that in as well to when will the deal be completed for the Victory project? Will you sell part or all of your interest, or would you run it through to production?

32:12 Yeah. Let me take that one. And, again, Steve, please add to that as as required. So, clearly, without having strong UK based production right now, we obviously are producers in California, not producers elsewhere in the portfolio. There isn't a benefit that we're seeing from a cash flow perspective right now. However and I think the important point here is that what is being recognized in the market is the fact that the importance of security of supply for local or indigenous production for indigenous demand has just increased substantially. That's both from a capital markets point of view and from an industry point of view. What does that mean is that whatever solution that we do end up having for Coralian and or Victory is really much it it it is very favorably positioned given all of those factors and the potential to access capital to move those asset to to move that asset in particular forward.

33:17 As a quick step back, we clearly undertook a strategic review of Coralian in order to find the best way of extracting value from the portfolio and, in particular, the Victory project for the purposes of securing funding to drive that forward. So although we cannot be specific about that process, we cannot be specific about the timing. The fact is that the way that the market has moved has meant that whatever the solution ends up being, it is far more favorably positioned or viewed today given the environment I mentioned than it was several months ago. What we'll do, obviously, is at the right time, provide the update to the market when that strategic review has come to a point that we can be more concrete about what the steps are on a go forward basis.

34:08 But as a reminder, we believe that this is an ideally positioned asset that meets all of the strategic objectives of regulatory bodies and indeed the requirements for security of supply for The UK, and UK gas needs. And can I just add to that? Because I'm also seeing a question that that's come through very much related to that in in terms of what the intention is, regarding whether we sell Victory, to turn it take it through to production or potentially IPO Keralian. You know? And the thing is the strategic review, we went into that with a very, very open mind, with the idea being that we're trying gonna try and find the best outcome for REABOLD and REABOLD shareholders, and that's the way we're thinking about this. And we we try and think about all of our projects like that.

34:56 So we've always gone into this with the mindset that we don't set, for example, a production target. We're not trying to get to a certain size or a certain scale or a certain amount of production. It's just not really how we think. What we're trying to do is invest capital into projects and then find the best possible outcome for that project for the company and and its investors. So that means we have a very open minded approach to potential next steps for these projects and potential exit routes. And the final presubmitted question we've got here, can you explain the Daybreak deal structure? How does this add liquidity, what is your intention with that liquidity? Yeah. Very happy to do that. And and hopefully, in the introductory sorry. When we ran through the presentation, that was covered off to a degree, but we'll put a little bit more color on that. So first of all, from the just to be clear, from the deal structure point of view, REABOLD will end up with shares in a US listed entity, in this case, Daybreak Oil and Gas.

35:55 So we will have shares in a company, and that is where the liquidity point comes in. Now the question about the best way to sort of extract or or or recognize value from that liquidity is difficult for us to say at this stage. However, the point I think we would strongly make is that the REABOLD California business within the REABOLD share price is absolutely not being recognized, we believe, for for the value inherent in that production and and indeed cash flow generation. We are clearly not minded to pursue the opportunities that we see there in California to the extent that a California focused entity would, and Daybreak Oil and Gas would be very much that entity. And with the capital structure and with the capital behind it in order to generate value from pursuing those opportunities is something that the two separate entities cannot currently do.

36:51 So we achieved all of those positive elements associated with growth potential in the fact that we have all will end up with shares in Daybreak Oil and Gas. And the point at which we decide to recognize value from that will clearly be dependent on how Daybreak trade the value of Daybreak shares in the market and how that asset and and company develops over the course of the next few years. So what it does mean is it gives us a great deal of optionality in a company that we think will be benefiting significantly from the current environment. That's fantastic. That concludes the presubmitted questions. As you can see, we've had a number of questions submitted throughout today's presentation by investors, so thank you again for submitting those. If I could just please ask you just to click on that q and a tab, start at the top, and where appropriate to do so, read out the question and give you a response, please.

37:50 Yeah. Sure. We've had a a number of questions, regarding funding. So what is the company's cash position? From Simon, do you have finance in place for the work package to drill a horizontal well? And do we need to raise cash to fund 2000 and and and '22 operations? So I'll sort of take all those in in one go. Our last, disclosed cash position was at the middle of last year, which was £6,400,000. Now since then, we've had, I guess, eight months of g and a and some spend at West Newton, on the latter part of the test program. Now just to be clear, though, we're only funding that at at our, sixteen seven 16.7% direct interest share of that work program. The 6,400,000 that we disclosed on our balance sheet does not consolidate the cash that's already within Rathlin or indeed any of the other companies, but Rathlin is the one that has a significant amount of cash on the balance sheet. So the vast majority of spend at West Newton both historically for their testing, last year and going forwards into the, work we do this year, including potentially drilling the horizontal well, the vast majority of that is coming off of the Rathlin balance sheet. So the answer to the questions about our funding position going forward is, yes, we are funded for twenty twenty two operations, including the 17% share, of a of a well, that we're likely to be drilling, at West Newton.

39:11 Well, yeah, just to add to that, I think part of the reason that we have, for instance, undertaken a, the strategic review at Coralian and b, chosen the deal structure as we've done with Daybreak Oil and Gas is that depending specifically on the outcomes outcomes of those two those two reviews and or corporate activity will determine, you know, a totally different picture potentially for REABOLD in terms of how and when it may choose to fund further activity across the rest of the portfolio. I think inherent in each of those, questions, both individually, and also collectively, is the risk of dilution to current REABOLD shareholders of the need to raise capital in order to aggressively go after parts of the portfolio.

40:03 And from a pure value question and value proposition, we are acutely aware of minimizing that risk associated with our shareholders. And, again, just to stress, that was a key underpinning element associated with the various routes that we've chosen to go forward with in elements of the portfolio. In this case, most most specifically, Pralion and Daybreak. The next question from Peter. In order of broad quantum, how much has REABOLD invested to date in various projects since inception? I think you can find that detail in some of our investor presentation. I don't really wanna run through that in in precise detail right now. But probably fair to say, clearly, the largest investment has gone into Rafflin Energy. Now a lot of that is still sitting within Rafflin, as I've mentioned before, on Rafflin's balance sheet because we've already went into that to fund, the third the third well that we would that we would participate in, which is likely to be the the the b two horizontal well.

41:13 And I think that ties in neatly with the fact that that that still is our largest potential asset. Right? So we've we've we've kind of tried to make sure that the quantums of capital that go into each project are reflective of the likely outcome in terms of the scale and and potential monetization ultimate monetization potential of those projects. Yeah. And then we also have a question that I it's quite technical and and quite specific associated with the anomalies at West Newson. So I see that the slide is up, slide nine over here of 13. And this was the residual map that that that we were showing in particular for West Newton. So this is an anomaly of the so it's a seismic response that we see specifically at West Newton over the Kirkham Abbey formation as mapped by the the Rafflin team and and and the geos over there.

42:13 So the identification of the Kirkham Abbey is, you know, a relatively strong response that we can see and or infer. And the fact that we are able to quite clearly map that is not only an indication that, seismically, we're able to see it, but with the well data that we have also got associated with drilling the A 1, a 2, and the the B 1 Zed well is that we have a good tie for lateral continuity across that entire anomaly. So I hope that was answering the question associated with the the very specific element of of of what we are seeing with those anomalies and and indeed, you know, in truth why it gives us not only so much confidence on Westmute itself, but some of the other anomalies that we see on the license area.

43:07 And it's it's it's you know, it's I think it's an important point. I mean, we we obviously focus on the West Newton field because that's the one that's right in front of us. That's the one that we know we've got, and we can identify it, and we can we'll be able to calculate, in in on increasing detail exactly what the resource potential is. And, obviously, it's something that will come into production a lot more more quickly than the others. But bear in mind, all of the work that's going on to unlock Quest Newton so when we go through these tests that initially we don't get the flow and, ultimately, we expect we will, all of these steps are unlocking all of this running room as well. So the size of the price here remains absolutely huge, and it's just a case of getting through this early stage of basically unlocking it from a technical perspective, and then we know there's a huge amount of running room associated with this project. Okay. So we we have another question associated with what is the realistic NPV of victory based on current gas prices using using historic valuations of 50 PFM massively undervalues the asset.

44:09 So that that's a fair question from the point of view we are clearly in a current environment where the gas price is much, much higher than the 50 PFM. I think it is important though, you know, to bear in mind, we go through cycles all the time, and it was not that long ago that we were looking at gas prices significantly below 50p a firm and getting down to 10 or or 15p a firm for gas. And because The UK gas market does not tend to be a market that is as deep and as liquid as certain other markets, I think it can be a bit dangerous to try and take current forward curves in order to put that into an NPV calculation as a realistic basis of determining what the value is. Again, I think just to stress the case here, part of what REABOLD is trying to achieve in supporting the strategic review that Kuralyon has undertaken is a market based assessment of what inherently is the value associated with the victory project.

45:12 And based on that will be the determination that we have all will use in order to to establish how that extracts the maximum value for REABOLD shareholders. Unfortunately, it's hard for us to give us to give any more color at this time in terms of the process, but I think that's probably the really the realistic way to view the determination of value of of of the Victory asset rather than necessarily looking at the current gas price environment and using that to do a calculation of NPVs. We've got another question from Paul. Are there any thoughts, discussions about listing Keralian? So we've touched on that already. Clearly, it as I said, all options are on the table, under the strategic review, and we'll do whatever we think, is the best outcome for for for REABOLD.

46:06 We'll we'll obviously drive Keralian in the direction of what we think is the best outcome for REABOLD, but everything, is on the table, with regards to the KARALIAN review. Based on the assets we have, this is from Michael. Based on the assets we have, do you believe RBD is very undervalued, and what do you consider to be a realistic mark market cap for the company to be? Well, you know, like all management teams, yes, we think that our company is undervalued. I think that's typically common amongst management teams at at at listed companies. But we do, in particular, feel of of late that we have been, particularly undervalued in the in the market. Now I'm not gonna put, a forecast on what I think a realistic market cap, should be, but what I would say is that we feel that we're in a position where we can demonstrate, that our asset base has considerable value and considerably more value than the market is attributing to us today. And, you know, clearly, it was very frustrating last year when we had to put out, you know, an announcement that said that we hadn't got sustained flow rates at West Newton because we knew that the market would react in a way that was clearly very negative, almost almost inevitably whilst we inherently believe there was still considerable value associated with the project and that we will demonstrate that over time. And that is what we're trying to do.

47:27 We've taken the first steps towards that, but work obviously continues. And we believe that over time, as we continue to unlock the project, that that value will become, more much more demonstrable. And it's true in the other parts of the portfolio too. So, again, part of our thinking with regarding the strategic review at Corellian is, of course, what does the market value this as in our our investor base value this at at the moment based on our current share price. That's one of the things we we think about. And then if you look over in California, you know, we've always had the sense that UK The UK market, UK investor base does not, value these US assets, as generously as The US investor base does, which is one of the reasons why we were particularly, keen to merge with a US listed entity. And once Daybreak has gone through the steps that it's going through now to completely clean up the balance sheet, once we combine the two businesses together and Sachin's talked about this already, and we have capital to go after growth opportunities in California, we feel that we'll get we'll see Daybreak, be attributed a a significantly better valuation than we think that The UK investor base has ever given the California, assets within within the REABOLD share price. So, hopefully, all of this activity helps to close that gap between what we think our asset assets are actually worth and what the market cap of the company is today.

48:45 Thanks, Steve. Yeah. So I think that probably answers the the the next question that that we had on there. But we have a couple more over here associated with West Newton and any of the solutions that Union Jack had utilized in their RESOURCES project and if that's useful for West Newton going forward. Just a couple of quick comments associated with that. The although it's understandable that the nature of the completions or enhanced completions that had been used at RESOURCES be applied colloquially as it were to what we have at West Newton. So would that be a solution? I think it's really important to stress at this stage that these are geologically very, very different types of settings.

49:32 West Newton is a much larger accumulation than RESOURCES, clearly based on the estimates that both parties have for those that has for those fields. But importantly, I think the work that really has to underpin the best way to ensure that we have the maximized recovery and flow potential from the fields is the work that is being done and undertaken that culminated in this r p s report. So I think we would just stress that a great deal of effort, time, and work has gone in with this substantial dataset that gives us a high degree of confidence that what is being proposed as the enhanced sorry, as the optimized completion and drilling methodology is what will achieve those those results that were, you know, as I said, the 5900 barrels of oil equivalent today of production for the first month of production.

50:27 And that result would be an absolutely fantastic result underpinning a strong commercial and economic case for West Newton. And maybe just to add, you know, whilst clearly, as Sachin said, they're geologically very different. I guess what RESOURCES does show is just the impact you can get from an optimized completion. Right? So we saw the production, the flow rates jump up very, very impressively at RESOURCES once that that latter completion was undertaken. So if anything, that's worth bearing in mind, I would think. But as Sachin said, the the specific nature of what we might do at the two fields is very different just given the different geological settings. K. We we have a few questions here associated with, first of all, California.

51:16 And I I just wanna stress at this stage, we we don't give monthly guidance production cash flow forecast, is what what the nature of the the question is. And I think just to stress that that is becoming increasingly less relevant as a guide to us because of the confidence that we have in terms of closing the nature of the transaction with Daybreak. So if this question is really trying to ascertain what is the underlying value and value potential proposition for the California assets net to REABOLD, the way to look at that now is really just to see how Daybreak reacts to news flow and and activity. And quite clearly, the underpinning of the Daybreak share price has demonstrated extreme keenness from the capital markets over there, both from an absolute value point of view, but also from just a very positive market momentum point of view that they are viewing this transaction very, very favorably.

52:18 So as a guide in terms of value and potential interest, I think that's probably the way to do it rather than necessarily the monthly production numbers, which, you know, unfortunately, from the nature of the question is really not what we guide to and really is not the philosophy of of REABOLD as a company. There's also a question associated here with Grizzly Island from the same questionnaire. And I think what we would stress here is that the asset portfolio that we are looking to pursue are the near term low risk drilling opportunities at Monroe Swell at at West Brentwood, and across the Kern County prospects and projects that Daybreak has on their license areas.

53:05 Maximizing near term oil production from those license areas, I think, will absolutely be the focus for the company. Maybe just take one more question now as time is is moving on, and it's probably quite a good one to finish on another one from Michael. Are RBD looking at other potential assets or have current high oil prices made new opportunities too expensive? Okay. So Sachin and I, you know, we we we spend time we always spend time looking at new opportunities. It's just part of what we what we spend our time doing, so we're always looking. We haven't entered into any new opportunities lately because the focus has been on the assets that we've already got. And, of course, everything really about the REABOLD model is about capital deployment. So where do we best deploy capital in order to get the best result?

53:52 And, clearly, we have been focused on the projects that we have and taking those forward of late rather than bringing new ones into the portfolio, which if they aren't funded, don't really demonstrate any value in the near term. But always looking at them because we think it's always important to have an understanding of what's available, in the industry at all times so that at the appropriate time, new projects can be brought into the, REABOLD portfolio. And then with regards to, do oil prices make them too expensive? That would possibly, not to say probably, possibly be true, for a lot of producing assets where, clearly, cash flows have ballooned under higher prices, and therefore, potential sellers would want clearly higher higher valuations on those. But just bear in mind, we're typically looking at projects that are free cash flow and are capital starved.

54:44 If they're free cash flow, they don't see an immediate benefit, from from higher commodity prices as nothing is in production and nothing is being sold. And therefore, problems of lack of capital, are just as acute, for those projects as they were beforehand. So I I think the simple answer is no. They haven't become too expensive. I think there are still opportunities for additional, deployment of capital should it be available into into new projects, and we are always, keeping a very keen eye on, what might be available. And I think just one other very quick point on that. In the history of REVOLD, one of the things we have been we have demonstrated, an ability to use execute on transactions for assets of the nature that Steve described and to move them forward through near term activity, whether that be drilling and or other elements of an operational work program to the point of getting them to value recognition.

55:39 For us, the critical thing right now is demonstrating that we can move it from those key points to value recognition for our shareholders. I think that that the question of our ability to access new opportunities is already hopefully well answered by the history of what we've achieved to date. And for us, I think that that that that is something we are keen to do when we are able to see the funding route for those assets because there's no point taking them on if we're not able to move them forward without diluting our current shareholders. That's fantastic. Thank you indeed for addressing so many questions from the investors, and thank you for submitting those. Of course, the team will be able to review all questions submitted today, and we'll publish responses where appropriate to do so on the Investor Me company platform.

56:27 Steven, just before redirecting investors to provide you with some feedback, which I know is particularly important to you, can I just ask you for a few closing comments, please? Yeah. Sure. So we've we've kind of run through the whole portfolio. We have, obviously, projects that are quite different from each other. We have a reasonable amount of diversification, and the projects have different characteristics that are at different stages in their life cycles. But I think it I hope it's become apparent that, you know, as always, we try to make sure there's a lot going on within that portfolio. Typically, if you look at the, track record of REABOLD, we've always had drilling, events to look forward to. At the moment, there's a lot of corporate type activity going on, particularly with the, California transaction the Korallian strategic review.

57:12 But we continue to try and move all of these projects forward. And as I said at the start, I think we're at a really interesting time, a a key inflection point as we move these projects into the point of potential monetization. And so, you know, I think that it it's a very interesting time to be to be following the company. And, clearly, thank you, everybody, for showing an interest, and thank you, everybody, for for listening to us today. Thank you very much. Steven, session. Thanks again for updating investors. Can I please ask investors not to close the session? It should be automatically redirected to provide your feedback in order the team can better understand your views and expectations. This will only take a few moments to complete. I'm sure it's greatly appreciated and valued by the company. On behalf of the management team of REABOLD RESOURCES PLC, we'd like to thank you for attending today's presentation. That concludes today's session, and good morning to you all.