TomCo Energy plc, the US operating oil development group focused on using innovative technology to unlock unconventional hydrocarbon resources, announces its unaudited interim results for the six-month period ended 31 March 2021.
Our Greenfield joint venture with Valkor LLC has made progress despite the COVID-19 pandemic. The oil sands plant at Asphalt Ridge developed by Petroteq Energy Inc (the "POSP") and enhanced by Greenfield has now been brought into sustained production, extracting oil from sands in a manner that we believe could be scaled up to be commercially viable in large, purpose-built plants, with a target of being capable of producing 10,000 barrels of oil per day. In late May 2021, we received a draft of the Front-End Engineering and Design ("FEED") study that, whilst still being reviewed, is encouraging. Taken together with the practical demonstration of the process via the POSP test plant, such draft report has led Greenfield to most recently move ahead with investigating the possibility of acquiring up to a 100 per cent. interest in a large oil sands site in Utah via Tar Sands Holdings II LLC ("TSHII") believed to be suitable for the construction of a potential initial commercial scale plant. Alongside the potential acquisition, Greenfield is also in the early stages of exploring possible financing opportunities for the potential project.
We have continued to postpone operations in respect of TurboShale's RF Technology, pending a return to normality after the COVID-19 pandemic abates.
Details of our progress during the reporting period, and more recently, is outlined in the various regulatory announcements the Company has issued. We will continue to provide regular updates as matters progress and believe that Greenfield is well positioned to achieve its goals.
At the time of our last fund-raising, in the autumn of 2020, Stephen West and Alexander Benger stepped down from the Board to focus on commitments elsewhere, I became Chairman, and we appointed two new non-executives, Richard Horsman and Robb Kirchner. In the spring of 2021, Robb Kirchner left us to pursue other opportunities, but I am delighted that we were able to attract Louis Castro to join our Board. Louis is widely respected in our sector and brings very valuable experience and judgment relevant to the Company's future progression.
During the reporting period, we raised £3.5m (gross) via a placing in November 2020, through the issue of 777,777,777 new ordinary shares at a price of 0.45 pence per share, with the net proceeds being used to provide general working capital and to fund Greenfield's development.
As at 21June 2021, TomCo had approximately £1,390,000 of cash reserves available to it. The Board believes that the Group has sufficient funds to cover its expected and normal outgoings for the next 12 months. However, we anticipate needing to raise additional funds in the event a decision is made to exercise our option to acquire the abovementioned site and commence work on our first full-scale oil sands plant and related matters. The contractual balance due if Greenfield was to assume full ownership of the site via TSHII is up to approximately US$16 million (dependent on the timing of the option exercise) and, at this stage, we envisage that Greenfield would require funding in excess of US$110 million for the construction of the first plant, the vast majority of which it would seek to finance by way of debt. Should Greenfield proceed with the acquisition, TomCo will work closely with its joint venture partner to explore the most appropriate financing solutions for the requisite funding.
I would like to thank shareholders for their continued support and encouragement through recent challenging times. We remain focused on meeting the further challenges that lie ahead.