Leed Petroleum Switches into Coal
Wednesday 14 September 2011
(Press release) – Leed Petroleum (LON:LDP) announced this morning that it had bought a 17.5% interest in Kyrgyz Republic-based Manas Coal – a coking coal exploration and development company.
Leed operated a portfolio of shallow-water oil and gas production assets in the Gulf of Mexico, but it sold these to a private company in May this year for US $16 million in order to satisfy debt owed by it to Unicredit Bank.
Today, the firm said that in return for its 17.5% stake it has advanced a sum of £750,000 to Manas by means of a loan and issued 166.7 million shares to Manas’ existing shareholders, for an aggregate value of £250,000, along with 166.7 million warrants at a subscription price of 0.15 pence per share.
Leed said that it will have the right to participate in further fundraising rounds undertaken by Manas and will also have the right to appoint a director to the board of the Kyrgyz company.
Manas will be using its proceeds from the loan announced today to acquire licence for geological exploration of coal at the Eastern Kokkia area of the Kyrgyz’s Toguz-Toro district, Jalal-Abad (جلال آباد) region. Leed said that based on previous geological studies and exploration expeditions the official government resource register records an estimate reserve of approximately 114 million tons of high-grade coking coal in the area covered by the Manas licence.
“The investment in Manas represents an opportunity to buy into a prospectively high value coal project at an attractive valuation,” said Peter Redmond, Leed’s chairman. “Manas expects in the coming months to complete a full evaluation and development plan and Leed looks forward to a developing relationship with the right to participate in the future development of the project.”