Xstate Resources Limited (ASX: $XST) asset divestment announcement

Xstate Resources Limited (ASX: $XST) has announced the divestment of its 25% working interest in the Red Earth Assets in Alberta, Canada, to Blue Sky Resources Limited for a cash consideration of US$2.73m (approximately A$4.17m). The transaction's Effective Date is 1 January 2024, with an anticipated Closing Date of 29 March 2024. The Company will be retaining its 25% Working Interest in the Crest Jinn assets and is seeking shareholder approval for the disposal of the main undertaking.

Executive Chairman's commentary on the divestment

The Chairman of Xstate Resources, Andrew Childs, stated, 'The timely sale of Red Earth has enabled the recapitalisation of the Company without incurring any additional shareholder dilution. The proceeds from this transaction are intended to be deployed to prosecute the acquisition and advancement of high-impact exploration and appraisal opportunities.'

Summary of Xstate Resources' divestment and outlook

Xstate Resources Limited (ASX: $XST) has successfully divested its Red Earth assets in Alberta, Canada, for a cash consideration of US$2.73m. The Company will retain its 25% Working Interest in the Crest Jinn assets and is confident in its ability to satisfy ASX regarding its ongoing operations and financial position. The funds received from the divestment will be utilized for progressing exploration opportunities, potential asset acquisitions, and working capital purposes. Xstate is optimistic about its future exploration and appraisal opportunities and remains focused on pursuing new opportunities in the oil and gas sector globally.