Knox Energy Solutions AS

Business and Financial Review • Jun 21, 2024

Knox Energy Solutions AS - Company update

Knox Energy Solutions AS - Company update

(Oslo June 21, 2024) Knox Energy Solutions AS (Knox, OSE: KNOX) today announces

an update on the company, in addition to an update on its current and future

projects and activities.

Knox went through a significant change in the strategy of the company when it

acquired about 20 percent of Rapid Oil, the owner of 15 percent of the Fyne

field in the UK North Sea. This transformed the previous Hyon AS into a company

focusing on the oil and gas industry.

Knox wants to build a larger company based on being an industry consolidator and

activist shareholder. The company will utilize the opportunity given by the

existence of a large number of smaller and undervalued public oil companies.

These companies represent opportunities for the acquisition of production at

attractive levels, often due to inefficient operation, lack of economy of scale,

or difficulties raising financing.

Knox believes corporate transactions are more attractive than asset

acquisitions. The company has access to a combination of strong experience and

track record in the capital market, strong expertise in subsurface, and

technical and operational competencies in oilfield services, and is in the

process of strengthening the team in the technical area.

There will be four main focus areas for future investments and combinations: (1)

Smaller undervalued companies, (2) facilitating access to the public market for

private companies, (3) special situations and (4) royalty positions. The company

will be opportunistic about its investments and will always be considering new

investments and exits without exception.

Knox will aim to avoid transactions demanding long approval processes related to

government approvals and other bureaucratic processes. This also includes in the

normal course of business staying below mandatory offering thresholds for public

companies and focusing on significantly undervalued companies as long as they

meet certain basic requirements.

Knox will prioritize capital market transactions, due to higher execution speed

and efficiency. Value creation will be achieved through:

· Accretive acquisitions based on improved valuation of the Knox shares,

· Synergies through combination of entities,

· Optimization of operation and cost structures,

· Improved multiples based on increased size of the company and

· Highly attractive dividend policy.

Status on key activities:

Fyne development project: Rapid Oil has started a strategic process of seeking a

buyer or a partner regarding the 15 percent fully carried interest in the Fyne

development project. This is further described in the enclosed teaser.

· Rapid Oil: Knox is following up on the plans related to the investment in

Rapid Oil.

· Negotiations on new business opportunities: The company is currently in

discussions regarding two projects in North Africa. One is related to providing

growth capital for an oil field currently producing 3 million bbls/d of oil

onshore. The second relates to getting access to a license and restart

production from several wells that had earlier been shut down.

· Financing: The company is focused on strengthening its working capital and

has secured a loan facility of NOK 2 million; it is furthermore in discussion

with specific investors regarding a potential convertible loan of NOK 5-10

million. In connection with the new investment opportunities mentioned above,

further capital raises would be initiated if the projects materialized as

expected.

· Strengthening of the team: The company is in dialog with specific

individuals representing significant expertise in their fields and expects to

reach agreements for future cooperation.

· Shareholders Meeting: The shareholders' meeting will take place on 12 July

For further information, please contact:

Harald B. Hansen, CEO, hh@knox-energy.com

About Knox

Knox Energy Solutions AS is an international energy company, with a holding in

Rapid Oil Production Ltd. (Rapid), a UK-based oil and gas company backed by a

highly experienced board and management team. Knox Energy Solutions AS is listed

on Euronext Growth under the ticker KNOX.