i3 Energy PLC Announces Partial Sale of the Company's Royalty Assets

("i3", "i3 Energy", or the "Company")
Partial Sale of the Company's Royalty Assets and Elimination of All Bank Indebtedness

EASTLEIGH, UNITED KINGDOM / ACCESSWIRE / April 17, 2024 / i3 Energy plc (AIM:I3E)(TSX:ITE), an independent oil and gas company with assets and operations in the UK and Canada, is pleased to announce that its subsidiary, i3 Energy Canada Ltd., has entered into a definitive agreement with a newly formed private royalty company for the sale of certain of the Company's royalty assets (the "Royalty Disposition") for a total gross cash consideration of USD 24.81 million (CAD 33.50 million⁽¹⁾) before customary closing adjustments. The proceeds of the Royalty Disposition mark the next step in transitioning i3's capital structure, enhancing the Company's financial flexibility through improved liquidity and enabling acceleration of its growth and income-based business plan.

Highlights:

Accelerating and Unlocking Value: Realization of USD 24.81 million in gross proceeds from the sale of an estimated 388 barrels of oil equivalent per day ("boe/d")⁽²⁾, translates to 6.9 times 2024 forecasted cash flow and approximately USD 63,960 per flowing boe/d, which represents a significant premium to the Company's current market valuations.

Pro Forma Financial Position Upon Closing: The proceeds of the Royalty Disposition will fully eliminate i3's outstanding bank indebtedness and establish a working capital surplus⁽⁴⁾ without materially impacting its working interest production base; which, together with forecasted cash flows and undrawn credit facility, provides the Company with significant liquidity to execute its growth and income strategies.

Retained Key Royalty Position at Greater Simonette: As part of i3's high-impact Montney oil asset at Simonette, the Company has retained its 16,160 acre royalty position, along with approximately 35 boe/d of associated production⁽³⁾ (collectively the "Simonette Royalty"), throughout this core area.

Ryan Heath, President of i3 Energy Canada Ltd., commented:

"i3 Energy Canada Ltd. is extremely pleased to have closed this complex accretive transaction with a newly minted private Canadian royalty company. Proceeds from the Royalty Disposition advantageously position the Company to fully eliminate its bank debt and create a working capital surplus; all while preserving a substantial, low decline, production base exceeding 19,000 boe/d (~48% liquids). The increased liquidity on the Company's balance sheet combined with its stable cash flows, will support both its organic and inorganic initiatives, as we actively look towards a dynamic 2024."