Xtract Energy Exits Kyrgyzstan Joint Venture
Friday 4 May 2012
(Press release) – Xtract Energy (LON:XTR) announced it has pulled out of its joint venture in Kyrgyzstan, which will allow previously committed funds to be diverted to other investment opportunities. The company held 25% of Zhibek Resources, which controls the Tash Kumyr exploration licence in the Kyrgyz Republic via a majority interest in domestic group KNG Hydrocarbons.
Xtract’s partner Santos International Holdings, which held the remainder of Zhibek Resources, decided to withdraw from the country. During the three and a half years since Santos acquired its interest in Zhibek Resources Ltd, KNG Hydrocarbons has acquired and processed approximately 100 km of new 2D seismic, but no material prospects have been identified. Given this and the decision by Santos to exit the Kyrgyz Republic, Xtract has decided to withdraw from the venture.
In order to be released from certain funding obligations under Xtract’s and Santos’s farm-in agreement, Santos has transferred a 10.5% stake, 140 million shares, in oil producer and explorer Caspian Oil & Gas to Xtract.
Chief executive Peter Moir said:
I am happy that this transaction has been executed such that any future funding of operational activities by Xtract has been terminated and, secondly, we become the beneficial owners of a substantial percentage of Caspian Oil & Gas Ltd (ASX:CIG), a company with operating assets and licences in the Kyrgyz Republic and elsewhere.
Xtract identifies and invests in a portfolio of early stage oil and gas assets and business interests with significant growth potential.
The company holds a royalty interest over the license portfolio currently owned by Extrem Energy, onshore and offshore Turkey. Xtract’s wholly owned subsidiary Elko Energy has interests in exploration and production licences in the Danish and Dutch North Sea. Its major asset in the Danish North Sea is a 33% working interest in an exploration and production licence 02/05 and a 33% working interest an adjoining exploration and production license 01/11. Elko also holds a royalty interest in gas-bearing license blocks P1 and P2 in the Dutch North Sea.
In addition, the group has a 70% interest in the Xtract Energy (Oil Shale) Morocco SA joint venture with a Saudi prince-linked company that evaluates an oil shale project near Tarfaya in the southwest of Morocco. Finally, Xtract’s wholly owned subsidiary XOL is focused on the development of the company’s oil shale resources in Australia and the technology for oil extraction from oil shale resources.