Rockhopper Exploration, the oil and gas company with key interests in the North Falkland Basin ("NFB"), announces its unaudited results for the six months ended 30 June 2025 ("H1 2025").

YEAR TO DATE HIGHLIGHTS

Capital Raise

• Firm and Conditional two tranche placing to raise up to US$140 million
• Company to undertake Open Offer for up to an additional €8 million

Firm placing US$115 million

• 53p per share plus one underwriting warrant for every four shares, at a price of 80p per share
• Expected to fund Rockhopper capex requirements for Phase 1 development plan for Sea Lion
• Funds held in escrow pending Final Investment Decision ("FID") for Sea Lion Phase 1 development

Conditional placing US$25 million

• 53p per share plus one underwriting warrant for every four shares, a price of 80p per share
• Approved by shareholders at a General Meeting on 16 September 2025
• Provides additional funding flexibility for subsequent phase planning, first phase contingencies and early project decommissioning
• Funds held in escrow pending occurrence of FID

Open Offer up to €8 million

• To be held at FID, 53p per share
• Provides shareholders the opportunity to participate at the same price as those in the placings
• No underwriting warrants as investors will not be required to subscribe funds to the escrow account
• Capped at €8 million under the Prospectus Regulations

Independent Resource Evaluation

• Carried out by Netherland Sewell and Associates ("NSAI")
• Sea Lion oil only numbers
• Unrisked gross contingent resources 2C 917 mmbbls (321 mmbbls net to Rockhopper)
• Unrisked gross contingent resources development pending 2C 727 mmbbls (255 mmbbls net to Rockhopper

Valuation of the Rockhopper net 2C 255mmbbls 35% working interest in Sea Lion

• $1.3bn at US$60 brent oil
• $1.8bn at US$70 brent oil
• $2.3bn at US$80 brent oil
• Net of all royalties and taxes

Ombrina Mare Arbitration Award (the "Award")

• Award fully annulled
• Insurance monies of €31 million now received (the "Insurance Proceeds")
• New funder and Rockhopper have submitted a new request for arbitration
• To the extent that Rockhopper makes a financial recovery from any new arbitration, after deductions for any reasonable costs and expenses incurred, that recovery will be utilised to reimburse the insurers in respect of the Insurance Proceeds

Italian disposal

• Amended SPA signed. Transaction completion subject to required regulatory consents.
• Allows Company to re-focus entirely on the Falklands

Outlook

• Funded for FID based on current financing plan
• Independent NSAI report confirms scale of opportunity
• Balance sheet strongest for over 5 years, with US$54m cash resources (unaudited) as at 31 August 2025
• Operator continues to target FID by year end 2025

Samuel Moody, CEO of Rockhopper, commented:
"This has been a transformative period for Rockhopper and the last few months have seen an acceleration of progress towards FID.  A financing plan is in place for which we have secured our base equity requirement and the potential value to all stakeholders is independently confirmed. 

"We are very grateful for the support of shareholders, both existing and new, at the recent fundraise. Having passed all of resolutions at the recent General Meeting, US$140 million is now in escrow pending FID, which we are more hopeful than ever of reaching by the end of this year."

Sea Lion project

The Company's core asset is a 35% non-operating interest in the Sea Lion oil field located offshore to the north of the Falkland Islands. As the recent NSAI report confirmed, the field holds highly material resources and is a world class asset.  The current plan is for the field to be developed in a phased manner, with the first phase targeting 170 million barrels via an FPSO.  The second phase targets an additional 144 million barrels to be developed through the same FPSO.  Production is targeted to peak at 55,000 barrels per day.  Subsequent phases are assumed to be developed via a separate FPSO. 

The financing plan for Phase 1 has a total capital requirement of US$1.658 billion from FID to first oil and US$2.058 billion from FID to project completion.  Of this, it is currently anticipated that approximately US$1 billion will come from a senior secured financing facility.  The total Rockhopper equity requirement, after the Navitas loans, assumed post first oil project cash flows and an additional equity cost overrun contingency have been taken into account, is US$102 million.  In addition, the Falkland Islands Government has previously indicated a requirement to provide for certain project decommissioning liabilities as each pre first oil well is spudded.  Our share of these liabilities have been estimated to peak at US$40 million at the time of first oil.  These requirements are anticipated to be met through the capital raise announced on 31 July 2025, with Rockhopper therefore being fully funded for its Phase 1 equity funding requirements at FID.  Based on analysis in the senior debt financing documentation, and dependent upon oil prices and field performance, it is currently envisaged that all subsequent phases of Sea Lion could be self-financing once Phase 1 reaches project completion.  The previously disclosed Navitas loans do not cover Rockhopper for any non-Phase 1 costs.

The independent resource evaluation carried out by NSAI (published on 3 June 2025) confirms the size of the opportunity at Sea Lion with an oil-only gross 2C of 917 million barrels (321 mmbbls net to Rockhopper) of which 727 million barrels are development pending (255 mmbbls net to Rockhopper).  NSAI has run a series of economic valuations of those 255 million barrels, all of which are net of all Falkland Government royalties and taxes.  The NPV net to Rockhopper of these barrels is confirmed by NSAI to be US$1.3bn at US$60 brent, US$1.8bn at US$70 brent and US$2.3bn at US$80 brent.

As disclosed in the Rockhopper Annual Report published on 5 June 2025, Rockhopper is currently in discussions with the Falkland Islands Government to resolve differences relating to a deferred tax liability arising from a previously disclosed tax settlement deed as the current arrangements are incompatible with the currently envisaged Phase 1 financing plan.  Based on discussions to date, the Company is hopeful that this matter will be resolved in conjunction with the Sea Lion project moving ahead to FID.

Having carried out the capital raise, unless otherwise required, the Company does not anticipate providing any more updates in relation to progress to FID until the point of FID itself, which is targeted to take place in H2 2025 by the Navitas (the "Operator").

Ombrina Mare

As announced on 3 June 2025, the Ombrina Mare Award was fully annulled by the ad hoc Panel of the International Centre for Settlement of Investment Disputes ("ICSID").  Fortunately, the Company had put in place an insurance policy (announced on 14 October 2024).  As announced on 29 August 2025, that €31m insurance has now been received in full.

The resubmission of a new request for arbitration was made in September and the new funder continues to be responsible for all costs associated with this.  Given that the original arbitration took from 2016 to 2025 to be resolved, Rockhopper does not anticipate this new process will have any impact on the Sea Lion financing or its ability to take FID.  To the extent that Rockhopper makes a financial recovery from any new arbitration, after deductions for any reasonable costs and expenses incurred, that recovery will be utilised to reimburse the insurers in respect of the Insurance Proceeds. Further announcements will be made in due course as and when appropriate. 

Italian Disposal

On the 14 October 2024, Rockhopper announced its planned exit from Italy through the signing of a share purchase agreement ("SPA") with Zodiac Energy Limited ("Zodiac"), for the sale of Rockhopper Civita Limited (a wholly owned subsidiary of Rockhopper Exploration Plc). Rockhopper Civita Limited holds all Rockhopper's Italian assets and liabilities, except for the Ombrina Mare arbitration.

The SPA is conditional on receipt of approvals from the FIG and the Italian regulator. As part of this approval process, the Italian regulator requested the recapitalisation of Rockhopper Civita Limited (the "Recapitalisation") before consideration be given to the proposed transfer.

The Recapitalisation has now occurred; however, this was not envisaged under the SPA and so an amended SPA (the "Amended SPA") has now been agreed and signed. Under the terms of the SPA, Rockhopper would have paid Zodiac in two instalments, with a retained upside participation to Rockhopper in two undeveloped licences (the "Earn Out Agreements"). Under the SPA, the second of those instalments and the Earn Out Agreements were contingent on successfully defending the Republic of Italy's annulment application and receiving a minimum of €10 million from the Monetisation Agreement. Following receipt of the €31 million of Insurance Proceeds, the substance of the Amended SPA is as previously announced, except the second contingent tranche and associated Earn Out Agreements are no longer contingent and as if Rockhopper had won the annulment. The key terms of the Amended SPA are:

• As consideration for the transaction, Zodiac will pay £1 and assume any outstanding liabilities from Rockhopper to Rockhopper Civita Ltd, such amounts not to exceed €4.5 million.

In turn, on completion, Rockhopper will:

• Provide evidence of the Recapitalisation and any subsequent additional recapitalisations;
• Provide evidence of there being no less than €5.5 million, in aggregate, in Rockhopper Civita Limited's cash and term deposits balances; and
• Receive the Earn Out Agreements - meaning that Rockhopper will retain a royalty on two assets within the Rockhopper Civita Limited portfolio, those being AC19 (a northern Adriatic licence with two gas discoveries and an additional adjacent prospect) and Serra San Bernado (which contains the Monte Grosso exploration prospect).

The royalties will take the form of either 10% of the revenues of the interests acquired by Zodiac or, should they realise value by on-selling the licences acquired, 25% of the gross proceeds received for the part sold.

The transaction continues to be subject to both Italian regulatory and FIG approval, the timing of which is uncertain. To allow for the delays caused by the Recapitalisation, the longstop date under the Amended SPA has been revised to 31 March 2026, which should be sufficient to enable these approvals to be given.

Following completion of the transaction, Rockhopper will have no remaining liabilities relating to its Italian licences, its P&A liability will have been reduced by some US$12.6 million (as at 31 December 2024) and its annual cash expenditure reduced by approximately €500,000 - €750,000.

The transaction with Zodiac allows Rockhopper to refocus the Company on Sea Lion by further reducing both short- and long-term costs, reducing risk, and protecting our balance sheet whilst maintaining some potential upside in two Italian licences.

KeyFacts Energy: Rockhopper Falkland Islands country profile