(Alliance News) - Oilex Ltd said Tuesday its annual loss narrowed on a reduced provision for doubtful debt, as well as steady revenue growth on higher oil sales.
Also on Tuesday, the oil & gas company said it has extended its exclusivity agreement with Koru Energy Ltd over the acquisition of a 50% interest in the Knox, Lowry and Whitbeck gas discoveries in the east Irish Sea.
The agreement has now been extended to the end of October from Monday, which was the original deadline.
Under the agreement, Oilex is to acquire a 50% interest in the licences for GBP500,000, with Koru holding the remaining 50% under a joint venture.
So far, Oilex has paid a non-refundable GBP50,000 exclusivity fee to Koru.
Oilex is currently in advanced negotiations with potential co-investors, who would substantially fund Oilex's payment, should the proposed transaction complete, it said.
For the financial year to the end of June, Oilex reported a pretax loss of USD3.1 million, narrowed from USD4.2 million the year before, as administrative costs decreased by 5% to USD2.0 million, and the provision for doubtful debts was reduced sharply to USD108,206 from USD1.3 million.
Revenue for the period increased by 15% to USD188,220 from USD163,563 the prior year on a sharp rise in oil sales, which more than offset a decline in gas sales.
"Coming from the company's resolve, there has been delivery of the expected resolution of the issues that have prevented the appraisal and with success the development of the Cambay Tight Gas Project and delivery of two new platforms for growth and delivery of value for shareholders. We expect that the coming year will see delivery of much activity in each of these areas that will yield significant results," said Chair Brad Lingo.
On Monday, Oilex announced several events, including the extension of Managing Director John Salomon's term to March 18, 2020 and Chief Financial Officer Mark Bolton's term to May 31, 2020.
The company also said it raised GBP600,000 through a placing of 315.8 million shares at 0.19 pence per share.
Proceeds from the placing will go towards advancing its Cambay project in India and other projects, alongside reducing debt and meeting working capital requirements.
Shares in Oilex were down 3.3% at 0.20 pence on Tuesday.
The placing was undertaken by Novum Securities Ltd, and following the fundraise, Oilex will have 3.19 billion shares issued overall.
By Dayo Laniyan; dayolaniyan@alliancenews.com
Copyright 2019 Alliance News Limited. All Rights Reserved.