LONDON (Alliance News) - Mayan Energy Ltd said Tuesday it entered a "turnkey" contract with an oilfield service company to begin a well workover at the Zink Ranch Field in Oklahoma, US.
The programme includes work on a total of five wells targeting 100 net barrels of oil per day in the mid-term, the company said.
The total cost of the programme amounts to USD255,000 which includes an initial payment of USD125,000 payable in Mayan shares at 0.85 pence per share, equivalent to 11.1 million shares.
An additional payment of USD100,000 will be made upon completion of the five well workovers, either in cash or shares at Mayan's discretion.
The deal include also a payment of USD5,000 per month in cash for six months for pumping and regulatory reporting services.
Mayan said it believes that Zink Ranch will help it achieve its production goal of 300 to 500 net barrels of oil per day.
To satisfy the share part of the agreement Mayan issued 11.1 million shares at 0.85p to settle the initial GBP94,700 for the work-over.
Admission to trading is expected on June 25, after which Mayan total issued share capital will be 1.23 billion shares.
Shares were trading down 5.3% at 0.72p each.
