31st Jul 2014 10:50
LONDON (Alliance News) - Leni Gas & Oil Thursday said it has agreed to pay lower-than-expected costs arising from its High Court action against Mediterranean Oil & Gas PLC over the sale of the Company's 10% interest in Malta Area 4 and that it has found further oil at the GY-667 well.
Despite Mediterranean Oil & Gas reporting costs at GBP1.5 million, the final settlement has been reached at GBP1.2 million, plus GBP16,437 of accrued interest.
The dispute dates back to July 2012, when LGO sold 10% of its interest in a Malta prospect license to Mediterranean Gas & Oil.
In March, LGO was informed that its fraudulent misrepresentation action against Mediterranean Oil & Gas had not been upheld and in April LGO decided not to appeal the ruling.
LGO said on Thursday that it has already paid GBP600,000 on account and has now agreed to pay the balance of GBP616,437.50 by August 7.
"The costs we have agreed are considerably less than previously provided for and LGO will now continue to focus efforts on significantly increasing its oil production Trinidad," Chief Executive Neil Ritson said in a statement. "This matter is now closed."
Separately on Thursday, LGO said the fourth well of its 30 well development programme on the Goudron Field had been successfully drilled to its total depth of 4,006 feet measured depth, finding significant gross oil pay in its primary Gros Morne target.
LGO said the Gros Morne interval at the well has extensive sandstones with good oil shows and is expected to have comparable reservoir potential to other recently drilled wells. The GY-667 well will now be logged from 1,905 feet to total depth.
The company has also found oil in the Lower Cruse and Goudron sandstone regions of the well, while a full report of the net pay intervals will be announced following analysis.
The news comes after a string of positive developments at the Goudron field, with oil finds in its first three development wells and its first well reaching a stabilised production rate of 240 barrels of oil per day in early June.
LGO shares were down 3.3% to 3.53 pence while MOG shares were down 0.8% to 6.25 pence on Thursday.
By Tom McIvor; [email protected]; @TomMcIvor1
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
LGO.L