MXO.L Share News (MXO)

(ShareCast News) - MX Oil completed the first of many steps on the road to production at its four Land Contract Areas (LCAs) in Mexico on Thursday, in conjunction with its local partner Geo Estratos.The AIM-traded oil and gas investing company said the four LCAs - Tecolutla, La Laja, Ponton and Paso de Oro - were all located in the prolific Tampico-Misantla Basin, which had produced around 6bn barrels of oil to date, and was currently producing at a rate of 70,000 barrels per day.Mexico's National Hydrocarbon Commission (CNH) ancitipated signing contracts with the companies awarded LCAs in the second quarter of 2016, MX Oil reported.In advance of this, CNH requested draft documentation be provided in order to monitor progress, including a Joint Operating Agreement, a Provisional Plan, and proposed funding for the guaranteed to support the committed work programme.The company said that on 2 February it, along with partner Geo, supplied the documents to CNH who have confirmed receipt."We are pleased to report that we have satisfied our initial obligations with our four LCAs", said MX Oil chief executive officer Stefan Olivier."As previously announced, the LCAs include previously discovered by underexploited conventional fields as well as other already identified exploration targets, all of which have enormous potential for development", he added.The company said there was still further work to be done with Geo to finalise the documents, and it was anticipated that further drafts would be requested by CNH prior to approval being granted and contracts being signed.