(Alliance News) - President Energy PLC on Monday said it has acquired an exploration contract in Argentina as part of the company's expansion strategy.
The oil & gas company's unit President Petroleum SA has conditionally agreed to take a 100% interest in the Angostura exploration contract area in the Rio Negro Province, Argentina, from Compania General De Combustibles SA.
No consideration is payable by President Energy for the Angostura licence, with President Energy assuming both income and also liabilities and commitments in relation to licence.
Compania General De Combustibles separately has agreed to invest USD1.9 million through several instalments by subscribing for new President Energy shares at prevailing market price at the time each instalment is due.
The Angostura licence acquisition is expected to increase President's daily production by more than 10%. The licence currently produces 80,000 cubic metres of gas per day and and 50 barrels of oil per day, representing in total slightly in excess of net 500 barrels of oil equivalent per day.
"This corporate action represents a continuation of the strategy of leveraging on our critical mass in Rio Negro and, in this case in particular, our strategic gas pipeline. The contemplated assignment would increase our production by over 10% whilst at the same time providing synergies and enhancing economies of scale," President Energy Chair Peter Levine said.
President Energy shares were untraded early Tuesday in London at 4.08 pence.
By Tapan Panchal; tapanpanchal@alliancenews.com
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