LONDON (Alliance News) - Nu-Oil & Gas PLC said Thursday that unit Enegi Oil Inc has signed a preliminary agreement for PVF Energy Services Inc to farm into Production Lease 2002-01(A) located in the Canadian province of Newfoundland & Labrador.
The company expects to enter into a definitive agreement with PVF Energy within 75 days.
Under agreement, PVF Energy will complete a 3D seismic survey in return for a 21% interest in the lease. The survey, which is expected to cost in excess of CAD5 million, will be funded by PVF Energy.
PVF Energy will also fund a new well into PL2002-01(A) in return for a further 49% interest in the lease. The cost of the new will is anticipated to be over CAD12 million.
In return for funding 100% of the costs, PVF Energy will also earn interest in the site infrastructure in line with its interest in the lease.
Shares in Nu-Oil & Gas were down 2.4% at 1.07 pence each.
