Oil & Gas Corporate News
San Leon Energy (Research restricted) (SLE, 22.75p, ? (0.0%)) announced that, further to the announcements on 23 December 2009 and 29 January 2010 regarding the provision of a EUR500,000 working capital facility to Island Oil & Gas plc, the Company has agreed to extend the Loan to 26 February 2010. The Loan and accrued interest will now be repayable on 26 February 2010 if San Leon and Island do not make an announcement pursuant to rule 2.5 of the Irish Takeover Rules in relation to Island by this date and is also immediately repayable if a 2.5 Announcement is made in relation to Island by any person other than San Leon. Discussions between San Leon and Island are continuing and both companies are working towards an agreement on an offer for Island, which the Directors of Island currently intend to recommend.
Roxi Petroleum Plc (RXP, 9.13p, ? (1.39%)) announced that, together with its partners Roxi's indirect 59% owned subsidiary Galaz Energy BV ("GEBV"), it has agreed through back to back agreements to sell a 40% interest in the operating company for the NW Konys Field, Galaz and Company LLP ("Galaz") to the Korean multinational trading company LG International Corp. ("LGI") for US$15.6m. In addition, LGI will pay US$8.4m for a 40% interest in existing debt of an equivalent value, which will be repayable through future production. LGI will also provide financing to Galaz of up to $26 million for appraisal and development of the NW Konys field. Management considers these funds will be sufficient to finance this project through to commercial production. GEBV currently has a 73.4% interest in Galaz, but as part of the back to back agreements GEBV will acquire a 24.6% of Galaz from its other local partners. Following the sale of 40% of its interests to LGI, GEBV will retain a 58% interest in Galaz.
As part of the above arrangements, Roxi has varied the terms of the previous agreement with KazRozMunai LLP, announced on the 19 November 2008, such that GEBV will now pay for services provided towards the work programme, rather than transferring any equity participation in Galaz to KazRozMunia LLP. The Galaz Agreements are subject to due diligence by LGI and the receipt of certain waivers from the regulatory authorities. However, if the…
