Independent Resources plc

June 25, 2008 02:00 ET

Update re Rivara

Ticker symbol: IRG

                  Italian partnership agreement completed for key Rivara project

AIM-quoted  Independent Resources plc ("IRG") has finalised the agreement under which the  Italian
energy  group  ERG  will help permit and develop its planned underground gas storage  facility  at
Rivara in the Po Valley, northern Italy.

Completion of the agreement and its associated transaction follows an announcement last April that
ERG  Power & Gas SpA ("EPG"), a subsidiary of the Italian energy firm ERG SpA, will become  a  15%
partner in a new company (now established as ERG Rivara Storage srl) to hold, develop, and operate
the future Rivara gas storage facility.

As  part  of  an  overall agreed investment of €9.5 million for its 15% ownership stake,  EPG  has
injected  an  initial €2.375 million on 24th June 2008, and is required to inject the  balance  of
€7.125  million  to  fulfil its capital subscription. IRG holds the remaining 85%  of  ERG  Rivara
Storage  srl.  As a consequence of this transaction, IRG will be reporting in due  course  a  non-
taxable  contribution  to  IRG group income in excess of £5 million. Such  contributions  will  be
recognised periodically, as and when the monies are received from EPG

The  transaction  values  IRG's  85% participation in Rivara at  €53.8  million  (£42.6  million),
equivalent to 127 pence per share based on IRG's existing issued share capital.

Following  completion  of the agreement, IRG will be submitting updated documentation  to  Italy's
Ministry of Environment pursuant to the project's Environmental Impact Study (VIA) as it seeks the
Ministry's environmental clearance. The incoming Italian government has announced a relatively pro-
business  and pro-development platform which can be expected to improve efficiency within  certain
key  ministries.  The Ministry of Environment has inherited a new VIA process  from  the  outgoing
government that is proclaimed to be more transparent and purely technical than previously, as well
as  more  efficient  in  its interaction with the public. The Ministry's  new  VIA  commission  is
expected  to  be  nominated  and  confirmed within July, and  we  look  forward  to  updating  our
shareholders with progress.

IRG  announced  in  April  that the ERG agreement will enable it to draw on  the  Italian  group's
extensive  experience as a reliable operator in the energy sector and will help  ensure  that  the
Rivara  project  meets the high technical and environmental standards required.  ERG  also  has  a
positive track-record in successfully navigating its VIA submissions.

IRG  is  currently seeking environmental approvals ahead of the planned development of  Rivara,  a
deeply  buried  fractured limestone structure viewed as ideally suited to  efficient  gas  storage
thanks to the presence of an active aquifer that provides constant natural water drive. Rivara has
an  expected nameplate working gas capacity of 3.2 billion cubic metres and the ability to deliver
in excess of 32 million cubic metres of gas per day back into the Italian pipeline system.

IRG  is  planning  the  Rivara development against a background of severe  mid-winter  gas  supply
disruptions  in  Italy  due to increasing gas storage capacity deficits,  and  has  appointed  the
oilfield services group Schlumberger to advise on and manage the subsurface development programme.
Rivara  is located next to the key convergence point between Italy's gas transmission network  and
trans-continental  pipelines, further enhancing its long-term strategic potential  as  a  physical
trading hub.

For further information contact:

Stephen Staley, Managing Director, Independent Resources plc:           01332 865 253
                                                                        07771 838 753
Allan Piper, First City Financial Public Relations:                     020 7242 2666
David Smith, Deloitte Corporate Finance (Nomad)                         020 7007 8177
                                                                    Background details follow:

IRG  was  admitted  to  AIM in December 2005 and is pursuing an integrated  and  asset-backed  gas
trading business in Italy with midstream components in Italy and upstream components within  Italy
and   in  North  Africa.  The  company  aims  to  pursue  this  long-term  strategy  in  the  most
environmentally-sustainable  way,  by  incorporating from  the  outset  the  permanent  geological
sequestration of CO2 emissions into its future commodity production and trading. IRG  has  focused
on  developing both conventional oil and unconventional gas production, and building a  profitable
portfolio through wholly-owned initiatives and partnerships.

For  the  ERG transaction, Independent Resources was advised by Banca IMI, the investment bank  of
Intesa Sanpaolo Group, and Ashurst, the international law firm.

Contact Information

  • Independent Resources plc