Electric Guitar (AIM:ELEG) has agreed a revised option with Vega Upstream JV, (VUJV), extending its deadline to exercise the right to acquire Oklahoma oil and gas assets to 31 October, after its original option lapsed on 31 July.
The AIM-listed company, whose shares remain suspended, is pursuing a strategy of generating behind-the-meter power from gas wells for intensive compute sites such as datacentres.
Completion of any deal must now happen by 30 November, with the delay stemming from VUJV's slower-than-expected acquisition of the underlying Oklahoma portfolio from Covenant Oil Group and ADM Energy PLC.
Instead of a half-interest in midstream and upstream assets, Electric Guitar can now acquire the whole of West Thomas Field Services (WTFS), which owns the Deer Creek gathering system in Custer County and around 160 acres of land hosting the midstream infrastructure.
WTFS also secures a five-year exclusive right to provide midstream services to VUJV's upstream operations, locking in gas supply and fee income that the company says is more predictable than upstream production revenue tied to commodity prices.
The purchase price is set at $6.9m, adjustable for net income from a strike date two months before completion. Up to $1m can be settled in new Electric Guitar shares, and up to $5m via a five-year term loan secured on the WTFS assets and guaranteed by VUJV, potentially reducing the cash outlay to under $1m.
Because the deal would constitute a reverse takeover under AIM Rule 14, it requires shareholder approval, an admission document, due diligence and re-admission to trading.
News Intelligence what this means for the company
Electric Guitar has restructured its option over Oklahoma midstream and upstream assets, narrowing the target from a half-interest in mixed assets to full ownership of West Thomas Field Services (WTFS)—a midstream gatherer with exclusive five-year rights to service Vega Upstream JV's upstream operations—for $6.9m, with completion by 30 November. The deal pivots the company's strategy toward more predictable midstream fee income rather than commodity-exposed upstream production, but requires shareholder approval and AIM re-admission, and the original option deadline lapsed in July, signalling execution risk.
The revised structure locks in midstream service fees and reduces commodity price exposure, but the deal remains contingent on shareholder approval, due diligence, and AIM re-admission—all uncertain. With shares suspended and the original option lapsed, the company faces material execution and regulatory hurdles before any asset acquisition closes.
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