26th Nov 2013 09:43
LONDON (Alliance News) - Oilex Ltd. Tuesday said it has received the balance of USD3.8 million from Magna Energy Ltd. for the sale of a 10% interest in the Cambay Production Sharing Contract in India.
The exploration-and-development oil company said that the equity sale represents external confidence in assets at the site and should allow for additional production from Cambay.
The company said that Magna also has the option to acquire an additional 5% participating interest upon payment of an additional USD2 million and Magna have 30 days to exercise this option.
Oilex said that it currently retains a 35% equity interest at the site and operatorship in the Cambay drilling programme, but the stake will drop to 30% if Magna exercises its option.
The company said that the deal is still subject to government approval but, if it goes forward, the proceeds will be used towards the costs of the upcoming Cambay-77H well, which will be fracture stimulated to confirm the applicability of North American fracking technology on Indian hydrocarbon resources.
Oilex shares were up 7.2% to 2.68 pence in early trading Tuesday.
By Tom McIvor; [email protected]; @TomMcIvor1
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