AIM Listed PetroNeft Announces Oil India Funding

AIM-listed PetroNeft Resources on Wednesday announced it has agreed to a $35 million funding by Oil India to finance work program on its West Siberian licence, Licence 61.

The funding is provided by way of an unsecured loan from Oil India to WorldAce Investments, the joint venture company that ultimately owns the licence. Principal repayments will commence in fourth quarter of 2019.

PetroNeft operates in the Tomsk Oblast, Russian Federation, and is 50 percent percent owner and operator of Licences 61 and 67. The first tranche of $10 million will be used to drill one vertical and up to three horizontal wells in South Arbuzovskoye field in 2016.

Additional delineation well (S-374) is also planned at nearby Sibkrayevskoye to better define south-eastern portion of the field

Optimisation studies and approvals for Sibkrayevskoye development is due to commence in 2017, the company said.

The planned 2017 work programme which will commence the development of the Sibkrayevskoye oil field is currently budgeted at $25 million. Oil India has indicated their willingness to fund this with a second loan tranche on similar terms to the one announced Wednesday.