Irish Petroneft Completes Siberian Purchase

Ireland-headquartered Petroneft has completed the purchase of an extra 40% interest in one of the two licences it operates in Russia's Tomsk region from its local partner Belgrave Naftogaz, it said in a London stock exchange filing on March 8.

Petroneft has paid $1.7mn in cash, funded by a three-year loan from Belgrave, and issued shares worth $1.2mn for the extra stake in Licence 67. The area contains the Ledovoye and Cheremshanskoye oil and gas fields. Petroneft discovered a condensate-rich gas cap after re-entering a well at Cheremshanskoye last year.

Petroneft's share in Licence 67 has risen to 90%.  The company also operates Licence 61 in the Tomsk region with a 50% interest. The agreement gave Belgrave the right to nominate a director at Petroneft and the Russian company has chosen its CEO Alastair McBain.

 "Over the last two years our understanding of this licence has improved considerably and we are delighted to be bringing it into production," Petroneft CEO David Sturt commented. "With oil prices improving and a favourable tax treatment for this licence, we see this as an investment which can deliver significant value at low cost."