Oilex says sale of Bhandut PSC interest has ‘substantially progressed’

Francesca Morgan
RNS Newswire
07:28, 29th June 2020

Oilex (AIM:OEX FOLLOW) told investors on Monday that the sale of the company's 40% participating interest in Bhandut PSC oil field (“Bhandut”) has ‘substantially progressed.’

The AIM-listed group previously accepted an offer in January this year from Kiri and Company Logistics Private Limited to dispose of its 40% participating interest (PI) in the Bhandut PSC.

Pursuant to the Agreement entered with Kiri and Company Logistics Private Limited (“Kiri”), the company will receive US$0.14 million in cash proceeds for the sale of its PI to Kiri.

The group has now confirmed that all necessary documentation has now been submitted to the Government of India to affect the transfer of the PI to Kiri which is anticipated in early July.

Kiri has expressed an interest in engaging the services of Oilex's office to review field production, stabilize operations and initiate field re-development of the Bhandut PSC.

Oilex detailed that Bhandut is presently shut-in and has been fully provided for in the Oilex financial statements as at 30 June 2019.

Shares in Oilex closed at 0.11p on Friday afternoon.

OEX price chart

The group also noted that the sale process being conducted by Gujarat State Petroleum Corp (GSPC) for its 55% interest in the Cambay Production Sharing Contract (PSC) in India ‘continues’ despite COVID-19 delays.

The sale process, which is internal and confidential to GSPC, continues to see ‘significant delays reflecting the impact of Covid-19 on all parties’, this morning’s statement said.

Oilex laid out the terms of an agreement with GSPC in early September 2019 which, upon completion, is intended to resolve the ongoing Cambay PSC dispute.

On 3 March 2020, Oilex advised that it had declined the first right of refusal in relation to GSPC disposing of its 55% interest in the Cambay PSC.

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