Deutsche Rohstoff AG

Regulatory Filings • Dec 18, 2014

News Details

Corporate | 18 December 2014 10:12

Deutsche Rohstoff AG: US-oil projects attractive even at low oil prices

Deutsche Rohstoff AG / Key word(s): Miscellaneous

18.12.2014 10:12

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Group AG.
The issuer / publisher is solely responsible for the content of this announcement.

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Deutsche Rohstoff: US-oil projects attractive even at low oil prices
Update on current status of projects/Positive effect from Euro-devaluation

Heidelberg. Deutsche Rohstoff and the management of its two US subsidiaries
Cub Creek Energy (CCE) and Elster Oil and Gas (EOG) expect to be able to
achieve attractive returns with oil and gas drilling activity in the US in
the coming years. The Break Even Point (BEP) for most wells in Wattenberg
Field, which are currently planned by both companies, is USD 40 per barrel.
Due to the already declining activities it is expected that drilling
development costs will decline in the future resulting in a decreased BEP
threshold.

At the moment, Cub Creek is completing several acquisitions of land in the
Wattenberg Field DJ Basin, Colorado. CCE management focuses on this area,
as it is one of the most attractive and economically most robust oil fields
in the US and is well understood technically and operationally by CCE. In
addition, EOG owns about 700 net acres in a focused project area located
in Wattenberg Field that remains with the company after the Tekton sale in
May, 2014. More details will be published by Cub Creek once the acreage
acquisitions are finalized.

Bob Gardner, CEO of Cub Creek, commented: "The DJ Basin and Wattenberg
Field collectively are well understood technically and economically by CCE
and is currently one of the most economically robust oil fields within the
U.S. capable of generating strong returns even at lower prices. We are very
pleased to have found, and due to lower oil prices will continue to pursue,
acquisition opportunities for economically attractive development. The
current market environment will facilitate our ability to acquire acreage
at reasonable valuations and is a significant part of the company's
development strategy."

Deutsche Rohstoff plans to finance possible wells from its own resources.
The vast majority of cash and cash equivalents held by the Group are in US
Dollars. Therefore, a positive currency exchange in the amount of
approximately seven million Euros incurred in the Group within the third
quarter, due to depreciation of the Euro against the US Dollar.

Tax payments in the US in the amount of approximately EUR 30 million have
now been completely made. According to the US tax code, it is possible to
get a tax refund if some of the future drilling costs are retroactively
charged against the profit from the Tekton sale. From the perspective of
Deutsche Rohstoff, such refunds will reduce drilling costs and will have a
positive effect on the outset assumptions for cost-effectiveness and also
on the break-even point, return and net present value of new wells. The
possibility of allocation is not just for investments in oil projects, but
also for mining projects.

Thomas Gutschlag, CFO of Deutsche Rohstoff AG, commented: "We believe that
the current situation is a very good chance to lay the foundation for high
yields in the next few years. We will of course adjust our investment
planning at the very volatile market situation. We will by no means
jeopardize our financial flexibility. "

Only minor changes occurred within the other subsidiaries of Deutsche
Rohstoff, compared to the information from the half-year report:

Rhein Petroleum (10% share): The test production for the both wells in the
Allgäu region have been postponed to mid-January by the operator
Wintershall, as the necessary equipment will only then be available. Rhein
Petroleum also plans to commence a third well in their license area
"Nördlicher Oberrhein" (south of Frankfurt) in mid-January.

Almonty Industries (24,9% share): The company presented a resource estimate
in accordance with Canadian NI 43-101 for its tungsten project Valtreixal
in Spain (www.almonty.com). A new study by Edison Research calculated a
target price of CAD 1.05 per Almonty share.

Devonian Metals (47% share): Concrete negotiations for the sale of the
project have not been initiated. Efforts for a sale are to be continued.

Ceritech (60% share): The work relating to the mineralized waste tailings
projects continue unabated. The Board is currently talking to different
tailings owners and is working on optimizing the treatment process.

Tin International/Sachsenzinn (60% share): The focus is on further
development of the license area Sadisdorf.

Regardless of the existing projects, Deutsche Rohstoff analyzes a number of
investment opportunities, particularly for the metals gold, nickel and
copper in North America and Australia. Due to the extremely difficult
financial situation of many companies in this sector, the Board is
confident of being able to acquire high-quality projects at reasonable
prices.

Heidelberg, 18 December 2014

Deutsche Rohstoff (Heidelberg, Germany), listed in the Entry Standard
segment of Frankfurt Stock Exchange, is establishing a new primary
producer. The company's focus is placed on oil & gas and so called high
tech metals such as tin, tungsten, and rare earth metals. All projects are
located in political stable countries with high environmental standards.
The business concept is based on redeveloping deposits, which have been
well explored in the past. For more information please visit
www.rohstoff.de.

Contact:
Deutsche Rohstoff AG
Thomas Gutschlag
Tel. +49 6221 871 000
info@rohstoff.de

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Language: English
Company: Deutsche Rohstoff AG
Friedrich-Ebert-Anlage 24
69117 Heidelberg
Germany
Phone: 06221-87100-11
Fax: 06221-87100-22
E-mail: gutschlag@rohstoff.de
Internet: www.rohstoff.de
ISIN: DE000A0XYG76, DE000A1R07G4,
WKN: A0XYG7, A1R07G
Indices: Entry Standard (Performance TOP 30)
Listed: Freiverkehr in Berlin, Düsseldorf, Stuttgart; Frankfurt in
Open Market (Entry Standard)

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