Nostra Terra Oil and Gas : New $5million Senior Lending Facility at 4.75%

RNS Number : 1661B

Nostra Terra Oil & Gas Company PLC 08 January 2018

08 January 2018

Nostra Terra Oil and Gas Company plc

("Nostra Terra" or the "Company")

New $5million Senior Lending Facility at 4.75%

Nostra Terra (AIM:NTOG), the oil and gas explora0on company with a por1olio of assets in the USA and Egypt, is pleased to announce that it has received approval for a new US$5 million Senior Lending Facility ("the Facility") with Washington Federal Bank. US$1.2 million of the Facility will be immediately available for use on comple0on of the legal paperwork ("Comple0on"). Comple0on is expected to take place before the end of January. The interest rate is 4.75%.

About the Senior Lending Facility

The Facility has an ini0al nominal amount of US$5 million, with US$1.2 million immediately available for use on Comple0on based on current produc0on ("Borrowing Base"). The size of the Facility and Borrowing Base will be reassessed at least twice yearly. The board of the Company an0cipates the Facility and Borrowing Base will increase with increased oil produc0on, any further increases in the Company's Proven 1P oil reserves, and with use of the BP Energy Company Hedging Facility (as announced on 29 September 2017 and 19 October 2017).

Currently the size of the Facility and Borrowing Base have been determined solely upon stabilized produc0on at Nostra Terra's Pine Mills asset. Recent reserves used by the bank were performed conserva0vely, with a "sensi0vity case", using an oil sales price of US$36.50 per barrel or less for the next 6 years. With current oil prices nearly double that, hedging a por0on of future produc0on could significantly increase funds available.

Increased produc0on across Nostra Terra's Permian Basin assets will further enhance the Company's position in this respect.

The interest rate on drawn down borrowings from the Facility is determined by the higher of either the sum of the Wall Street Journal Rate plus 0.25% or a flat 4.25%. The current Wall Street Journal Rate is 4.5%. As such the current interest rate applied to use of the Facility is 4.75%

The Facility is not restricted to geographical region. Nostra Terra can deploy funds from the Facility for opera0onal purposes and acquisi0ons in its current areas of opera0on, in the USA and Egypt, or in other areas should the opportunity arise.

Washington Federal Bank

Washington Federal Bank is a well-regarded lending provider, which has an established pedigree in the energy market. It is based in SeaEle, Washington, and has approximately US$15 billion in assets under management.

Use of funds

As previously announced, Nostra Terra plans to use the Facility to accelerate its growth, focusing ini0ally on increasing the Company's free cash flow genera0on. Nostra Terra plans to commence further drilling at its 24-drill ready loca0ons across its por1olio of Permian Basin assets. In addi0on to this Nostra Terra has iden0fied a pipeline of poten0al acquisi0ons to expand its Permian acreage and continues its discussions with the stakeholders at its Egyptian asset with a view to realizing value.

Nostra Terra will continue to update the market on all progress in the coming weeks and months.

Matt Lofgran, Chief Executive Officer of Nostra Terra, commented:

"Securing the hedging facility with BP Energy Company last September marked a step change for Nostra Terra. We now have approval for a new, non-dilu0ve and sizeable funding source for the Company, on highly aErac0ve commercial terms. We're excited to be working with such a strong energy lender asWashington Federal that endorses our plans to grow production, cash flow, and the size of the facility.

With commercial flow tes0ng due to commence shortly at our recently drilled Twin Well and the permitting process to begin for our next Permian development well, this is an extremely exciting time for Nostra Terra. The new funds of the Facility will allow us in 2018 to quicken the pace of drilling our 24 drill ready loca0ons, make further progress in Egypt and seek new acquisi0ons to add value to the

Company. We look forward to providing further updates on all this soon."

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

For further information, visitwww.ntog.co.uk or contact:

Nostra Terra Oil and Gas Company plc Matt Lofgran, CEO

Tel:

[phone]

Strand Hanson Limited

Tel:

[phone]

(Nominated & Financial Adviser and Joint Broker)

Rory Murphy / Ritchie Balmer / Jack Botros

Smaller Company Capital Limited (Joint Broker) Rupert Williams / Jeremy Woodgate

Tel:

[phone]

This information is provided by RNS

The company news service from the London Stock Exchange

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