(Alliance News) - Regal Petroleum PLC on Tuesday announced the acquisition of a licence in Ukraine for nearly USD9 million.
Regal is purchasing LLC Arkona Gas-Energy, which holds the Svystunivsko-Chervonolutskyi licence. The owners of Arkona are Igor Mychko, Oleksandr Neschchotnyy, Dmitro Volonets, and Oleg Olkhovoy.
Regal will pay a first tranche of USD4.3 million, then a second tranche of USD2.2 million and a third tranche of USD2.2 million.
The second tranche is conditional on a successful outcome in litigation against Arkona related to the licence. The third is due 12 months after the second is paid, but will only be paid if the second payment is made.
The licence is in the Poltava region of north-eastern Ukraine. It covers 97 square kilometres and is 15 kilometres east of Regal's Svyrydivske licence. The new licence is prospective for oil and gas, Regal continued, with five wells drilling since the 1980s although none are currently producing.
Regal said the licence has hydrocarbon reserves of approximately 38 million barrels of oil equivalent, being 4.9 billion metres cubed of gas and 860,000 tonnes of condensate.
Shares in Regal were 18% higher on Tuesday afternoon in London at a price of 14.10 pence each.
By George Collard; georgecollard@alliancenews.com
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