15th Jan 2014 11:14
LONDON (Alliance News) - Rose Petroleum PLC Wednesday said two fracking licences in Germany, for which the company entered into a sale and purchase agreement in August, have been renewed, and the company can now complete the process.
The oil, gas, gold and silver producer, with operations in Mexico, made an initial payment for the sites of EUR300,000 to secure the sites in August, with a further EUR100,000 to be paid now that the licences have been renewed.
The company said the licences are now subject to a 30-day period during which any legal challenges to their renewal can be made, but the company expects to complete the transaction on January 20.
Following the deal, Rose Petroleum will hold 100% of both sites, which are shale gas prospects in an area of roughly 635,000 acres.
Shale gas hydraulic fracturing, otherwise known as fracking, involves extracting gas trapped in shale by pumping in pressurised water and chemicals.
In the US, fuel prices have falling sharply as fracking has become commonplace across such states as North Dakota and Mississippi.
However, so far in Europe fracking has had mixed results - often being either controversial or unreliable. In the UK, there have been major protests against the method, which critics fear will pollute water tables in rural areas and may cause small earthquakes.
Rose Petroleum shares were up 6.7% to 0.400 pence, putting it among the top AIM gainers Wednesday.
By Tom McIvor; [email protected]; @TomMcIvor1
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