LONDON (Alliance News) - Shale exploration and development company TomCo Energy PLC on Friday said it has made progress on the Holliday Block in Utah but said it has had to initiate a restructuring programme to cut costs after the developer of the technology needed for the project said last week the equipment would be delayed.
Last week, Red Leaf Resources Inc said it would delay the target date to complete the construction of the EcoCapsule technology by two years to 2017, news which send TomCo shares tumbling.
As a result of the delays, TomCo has initiated a restructuring plan to cut its to "materially reduce" its corporate cost base. As part of this, Chief Executive Paul Rankine will step down in the next three months, though will remain a technical consultant to the company.
The company said it expects that after the remaining permits for the Holliday Block are granted, spending on the project will minimal. It added it is still considering potential merger and acquisition options in order to maximise shareholder value.
TomCo shares were down 8.1% to 0.161 pence on Friday morning.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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Tomco Energy (TOM)