(Alliance News) - Regal Petroleum PLC on Wednesday said a proposed USD40 million acquisition in Ukraine has collapsed.
In November last year, Regal signed a memorandum of understanding with Lidiia Chernysh and Bolaso Investments Ltd, who each own half of PJSC Science & Production Concern Ukrnaftinvest, or UNI, which holds the Belolisky and Alibeysk-Trapivska licences.
The MoU outlined a plan to buy the licences for up to USD40 million. This would have been USD9 million on completion, USD1 million on meeting "certain conditions", and then 25% of the net present value of the proven reserves of the licences, capped at USD30 million.
The two licences are located in the Odessa region of south-western Ukraine. They were granted in 2004 for 20 years.
However, on Wednesday Regal said the MoU has expired and has now been terminated. It was unable to reach a final agreement, and a USD500,000 deposit put down by Regal will be returned.
Regal shares were 6.3% lower on Wednesday morning in London at 15.00 pence each.
By George Collard; georgecollard@alliancenews.com
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