Russian oil group PetroNeft Resources seals Oil India deal

4th Jul 2014 16:18

Russian oil group PetroNeft Resources has completed its License 61 farm-out to Oil India, leaving it with "significant further funds" to strengthen the company.Under the terms of the agreement Oil India now owns 50% of the license in return for a total investment of up to $85m. The investment is set to include a $35m upfront cash payment, a $45m committed exploration and development expenditure on the licence and a $5m performance bonus, if the field reaches an average of 7,500 barrels of oil per day in the next five years.The Dublin-based group has repaid all the debt owed to Australian bank Macquarie and Arawak, leaving it debt-free.Chief Executive Dennis Francis said: "We look forward to working closely with our new partners Oil India and to realising the full potential of this asset and to developing further opportunities together."The share price had risen 0.08p or 1.2% to 6.38p by 15:44.WS