(Alliance News) - Caspian Sunrise PLC on Thursday said it has received the "much anticipated" MJF licence upgrade, securing the right to sell the majority of oil, produced from the the BNG contract area, by reference to international rather than domestic prices.
Caspian Sunrise explained that, under the licencing system in Kazakhstan, oil produced under an appraisal licence must be sold at domestic prices. Over the last couple of years the domestic price has been in the range of USD18 to USD20 per barrel.
The AIM-listed company said it has now moved to a production licence, with the majority of the oil produced from that structure allowed to be sold by reference to international prices.
Under the terms of the new MJF production contract, the proportion of export sales to domestic sales is set at a ratio of 70:30. Caspian Sunrise expects the first sales of such oil in the third quarter of 2019.
"The arrival of the much heralded MJF licence upgrade, with its near doubling of the price we can expect for the oil produced from that structure, will allow the company to move forward at faster pace with both our development plans for MJF structure and in bringing our deep wells into production," said Executive Chair Clive Carver.
Caspian Sunrise shares were trading 0.2% lower on Thursday in London at 11.855 pence each.
Caspian Sunrise (CASP)