Clarification of Transactions

RNS Number:1633M
Minmet PLC
21 January 2008



Stock Exchange Announcement

21 January 2008

For immediate release


                                   Minmet plc

                         Clarification of Transactions


Further to the announcement on 21 December 2007 of the suspension of trading of
its ordinary shares on AIM, Minmet plc ("Minmet" or "the Company") (AIM: MNT),
the AIM traded oil and gas and natural resource company, announces the following
transactions:





Proposal to acquire Alaska Oil and Gas Resources Limited ("Alaska")



Under the terms of a conditional Sale and Purchase Agreement between the Company
and Carbon Energy Investments Limited ("Carbon") dated 23 August 2007, Minmet
agreed to purchase 100% of the issued share capital of Alaska ("the Alaska
Agreement") for a consideration of US$87.5 million, payable as to US$4.35
million in cash on the date of the agreement by way of returnable deposit ("
Alaska Deposit") and as to the balance in fully paid Minmet shares at market
value. The agreement was conditional on full legal, financial, geological and
engineering due diligence, regulatory approvals and compliance with the AIM
Rules for Companies regarding reverse takeovers.



Payment of the Alaska Deposit constituted a substantial transaction under Rule
12 of the AIM Rules for Companies. If completed, the acquisition of 100% of the
issued share capital of Alaska would have constituted a reverse takeover
requiring advance approval from the Company's shareholders.



Alaska has a 75% interest in an Exploration and Joint Venture Agreement ("JVA")
with Escopeta Oil and Gas Limited ("Escopeta"), which in turn owns three oil and
gas exploration licences, namely the North Alexander, Kitchen and East Kitchen
prospects, covering approximately 100,000 acres in the Kenai peninsula in the
Cook Inlet, Alaska, USA ("the Alaska Project"). Neither Alaska nor its JVA are
currently revenue generative.





Cancellation of the Alaska Agreement



Under the terms of an agreement between the Company and Carbon dated 31 December
2007 (the "Alaska Cancellation Agreement") the Company agreed with Carbon that
the Alaska Agreement will be cancelled and that the Alaska Deposit will be
repaid to Minmet within 180 days of 31 December 2007, together with interest
which shall accrue from 1 March 2008 until repayment.



As an alternative to payment in cash, Minmet may, at its sole discretion, elect
to accept repayment of the Alaska Deposit and accrued interest in new ordinary
shares in a new vehicle, intended to be listed on a public market or sold, which
Carbon intends to promote to acquire Alaska ("Alaska Vehicle").



In addition, Carbon has agreed to pay a premium as consideration for the Alaska
Cancellation Agreement in the form of new ordinary shares in the Alaska Vehicle
equivalent in value to a further $4.35 million. It has also been agreed that
Minmet may appoint three members to the board, and participate in the promotion
and listing, of the Alaska Vehicle.



Under the terms of a share charge granted by Tucumcari Investments Limited ("TIL
") over its shares in Tucumcari Exploration LLC ("TUCX") in favour of Minmet
dated 2 October 2007 ("the TUCX Share Charge") and announced by the Company on 2
November 2007, TIL gave security for the obligation of Westcoast Group Limited
to guarantee and indemnify Minmet in respect of any loss in the book value of
Minmet's investment in Gold Oil Plc arising from the sale of 8,300,000 shares in
Minmet previously held by Gold Oil Plc ("the Gold Oil Shares") that were
deposited with brokers with instructions to have them placed in the market with
the proceeds being distributed to Minmet under the terms of the Dissolution of
the Gold Oil Arrangements.



Under the terms of the Alaska Cancellation Agreement Carbon has procured that
the TUCX Share Charge be extended by TIL to include Carbon's liability to repay
the Alaska Deposit.



The extension of the TUCX Share Charge to include Carbon's liability to repay
the Alaska Deposit is a related party transaction under Rule 13 of the AIM Rules
for Companies because Peter Maddocks, the Company's Chairman, is a director and
shareholder of TIL.



The directors of Minmet (excluding Peter Maddocks) consider, having consulted
with the Company's Nominated Adviser, that in all the circumstances, the
extension of the TUCX Share Charge to include the liability to repay the Alaska
Deposit is fair and reasonable insofar as the Company's shareholders are
concerned.





Cancellation of the disposal of Minmet's 25% interest in TIL



In March 2006, Minmet acquired a 25% interest in, and advanced funds by way of a
loan to, TIL for an aggregate investment of approximately US$2.75 million, which
Minmet had advanced by way of a shareholder loan. This was referred to in the
Review of Operations contained within the announcement of Minmet's final results
for the year ended 31 December 2005, which was released on 23 May 2006.



In two separate but linked transactions in July and September 2006 ("the
Disposals"), the Company disposed of its 25% interest in TIL and assigned its
US$2.75 million shareholder loan and other assets to Charms Investments Limited
("CIL") for a total consideration of US$3.35 million. The Disposals were
described in the Company's announcements of 20 July 2006 and 12 February 2007.



Pledges over shareholdings in a number of companies, including TIL, were granted
to Minmet to secure payment of the consideration. However, subsequent to the
Disposals the consideration has remained unpaid and the security has not been
enforced.



Under the terms of an agreement between the Company and CIL dated 17 January
2008 ("the Tucumcari Cancellation Agreement"), the Company has agreed with CIL
that the Disposals will be cancelled with the consequence that ownership of the
25% interest in TIL and other assets and loans will be restored to Minmet and
the debt due to Minmet from CIL representing the outstanding consideration will
be cancelled.





The Restructuring and Exchange of Minmet's Interest in TIL



Under the terms of an agreement between Peter Maddocks (as sole registered
shareholder of TIL), TUCX and the Company dated 17 January 2008 ("the Tucumcari
Restructuring Agreement"), it has been agreed that following the cancellation of
the Disposals as described above, Minmet's 25% interest in TIL and its loan will
be restructured and exchanged for a 25% interest in Tucumcari Exploration LLC ("
TUCX"), a wholly owned subsidiary of TIL, which holds certain gas leases
comprising 16,000 acres in Tucumcari, New Mexico ("Tucumcari Project"), and a
receivable due from TUCX in the sum of US$2.75 million ("the Restructuring and
Exchange").



The Restructuring and Exchange is a related party transaction under Rule 13 of
the AIM Rules for Companies because Peter Maddocks, the Company's Chairman, is a
party to the Restructuring and Exchange.



The directors of Minmet (excluding Peter Maddocks) consider, having consulted
with the Company's Nominated Adviser, that in all the circumstances, the terms
of the Restructuring and Exchange are fair and reasonable insofar as the
Company's shareholders are concerned.





The grant of an Option to acquire a 75% interest in TUCX



Under the terms of an agreement between TIL and the Company dated 17 January
2008 and subject to cancellation of the Disposals and the Restructuring and
Exchange, Minmet has been granted an option ("the Tucumcari Option") to purchase
the 75% of the issued share capital of TUCX which it will not already own
following the Restructuring and Exchange, at a consideration equal to 75% of the
net present value of the Tucumcari Project (or in the event that a range of
values is given, the lowest point of such range) as determined by a Competent
Person's Report complying with Appendix 2 of the Guidance Note for Mining Oil
and Gas Companies issued in March 2006, to be commissioned by the Company (less
a discount of 25%), adjusted for the liabilities of TUCX.("the Consideration")



The Tucumcari Option is exercisable at any time within three months after
delivery of the Competent Person's Report. Upon exercise of the Tucumcari
Option, the Consideration will be payable as to the amount required to satisfy
the aggregate of the liabilities secured by the TUCX Share Charge in cash and as
to the balance in new ordinary shares in the Company.



On 10 October 2007 Minmet advanced approximately US$6 million to TIL by way of a
returnable deposit. ("the TIL Deposit"). In addition, pending exercise of the
Tucumcari Option, Minmet has agreed to make advances to TUCX by way of loan to
meet the ongoing funding requirements of the Tucumcari Project up to a level of
US$3 million ( "the Advances").



As security for the repayment of the TIL Deposit and the Advances, TIL has
agreed to procure that the TUCX Share Charge be extended to cover repayment of
the TIL Deposit and the Advances.



The TIL Deposit, the Advances, the Tucumcari Option and the extension of the
TUCX Share Charge are related party transactions under Rule 13 of the AIM Rules
for Companies because Peter Maddocks, the Company's Chairman, is a director and
shareholder of TIL.



The directors of Minmet (excluding Peter Maddocks) consider, having consulted
with the Company's Nominated Adviser, that in all the circumstances, the terms
of the TIL Deposit, the Advances, the Tucumcari Option and extension of the TUCX
Share Charge are fair and reasonable insofar as the Company's shareholders are
concerned.





Reverse Take Over



As the exercise by Minmet of the Tucumcari Option and the consequent acquisition
by the Company of the whole issued share capital of TUCX will be a reverse
takeover under the AIM Rules for Companies, the Minmet Board has requested that
trading in the Company's shares should continue to be suspended pending the
publication of a full circular to shareholders. In view of the necessity to
prepare a Competent Person's Report, the preparation of this circular is likely
to take several months.





Commenting on the above, Jon King, the Company's recently appointed Chief
Executive said today:



"These transactions are part of a strategy to create value for all shareholders
by transforming Minmet into a substantial oil and gas entity in a controlled and
structured manner.  The Board's decision not to proceed directly with the more
speculative Alaskan project (whilst retaining a carried interest) and to focus
on the phased development of the Tucumcari assets is designed to provide a
significant asset base and cashflow to fund Minmet's future growth strategy.



"We are excited by the opportunities available to Minmet and we look forward to
presenting our detailed proposals to shareholders as soon as possible and to
building Minmet accordingly. In the meantime, we will issue further
announcements to update shareholders".









For further information, please contact:

Peter Maddocks, Chairman, Minmet plc                      +44 (0) 7846 587208

Nabarro Wells & Co. Limited, Nominated Adviser            +44 (0) 20 7710 7400
Robert Lo / Richard Swindells




                      This information is provided by RNS
            The company news service from the London Stock Exchange
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