LONDON (Alliance News) - Red Emperor Resources NL shares fell in early trade Tuesday after the company said drilling activity has still not started at the Block VIb site in Georgia.
Red Emperor said it was advised last month by Strait Oil & Gas, the operator of the licence, that a drilling programme and valid drilling licence was in place with the Georgian Oil and Gas Ministry.
It said that while a drill rig and all required services are available to start work at the site, Strait's majority shareholder, London-listed Range Resources Ltd, has been focused on disposing of an asset rather than making continued further investment in the site.
Range is in the process of offloading its drilling services unit, but the sale of this was delayed last week.
Red Emperor said it understands Straits is intending on negotiating to extend the production sharing contract covering the block, which was due to expire in March, but said there is no certainty that an extension will be agreed.
Shares in Red Emperor were down 25% to 1.85 pence in early trade, the worst performer in the AIM All-Share.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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