LONDON (Alliance News) - Red Emperor Resources NL shares fell Tuesday morning after the company said drilling activity has still not started at the Block VIb site in Georgia as fellow AIM-listed Range Resources Ltd focuses on disposing of the asset.
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 the asset rather than making continued further investment in the site.
Later on Tuesday morning, Range confirmed it is planning to dispose of its assets in Georgia as it looks to focus on its Trinidad assets. It said it is seeking to restrict any further investment in Strait and is actively exploring disposal options for the asset.
Red Emperor said it understands Strait 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 10% to 2.2 pence on Tuesday, one of the worst performers in the AIM All-Share. Range Resources shares are suspended.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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