Russia's PetroNeft Restarts Drilling Operations; Now Debt-Free
August 19 2014 - 3:48AM
Dow Jones News
By Alex MacDonald
LONDON--Russia-focused oil and gas exploration company PetroNeft
Resources PLC (P8ET.DB) said Tuesday that it has restarted drilling
operations following the completion of a joint venture agreement
with Oil India Ltd. (533106.BY) in July.
PetroNeft agreed to give Oil India a 50% interest in license 61
in return for an $85 million investment.
The investment includes a $35 million upfront payment which
PetroNeft used to become debt-free. Another $45 million will be
used to fund the exploration and development of license 61 while
the remaining $5 million will be paid as a bonus if the
Sibkrayevskoye Field reaches 7,500 barrels of oil per day within
the next five years.
"The initial meetings of the Joint Venture Working Group were
extremely productive and we look forward to working closely with
our new partner Oil India," said PetroNeft Chief Executive Officer
Dennis Francis.
The company has put in place a multi-well drilling program which
will start with the Tungolskoye No. 5 well. It is also embarking
upon a major seismic program which will shape the future direction
of its drilling activity.
Write to Alex MacDonald at alex.macdonald@wsj.com