logo-loader
RNS
viewLargo Resources Ltd

Leni Gas & Oil PLC - Completion of Acquisition of Assets in Hungary

RNS Number : 2576Z Leni Gas & Oil PLC 17 July 2008 FOR IMMEDIATE RELEASE 17 July 2008 LENI GAS & OIL PLC ('Leni Gas & Oil' or the 'Company') Completes Acquisition of Gas Development Assets in Hungary Further to the announcements made by the Company on 14 April 2008, in relation to the conditional investment of 7.27% interest in gas developments in Hungary operated by Ascent Resources plc, the Company announces that all conditions precedent in the Investment Agreement have been completed. The Investment Agreement provides the Company with a 7.27% interest in PetroHungaria kft ('PetroHungaria') and a 14.54% interest in ZalaGasCo kft ('ZalaGasCo'). PetroHungaria owns a 100% interest in the Peneszlek gas development project in the Nyirseg permits in eastern Hungary, and ZalaGasCo has a 50:50 joint development agreement with MOL Hungarian Oil & Gas ('MOL') for the re-development of fields in western Hungary. Under the terms of the Acquisition Agreement, the Company has: * Issued the remaining EUR 1 million cash consideration, being the balance of the EUR 2 million consideration payable on completion of the Investment Agreement. 2. Been notified by PetroHungaria, the commissioning of the Peneszlek gas production facilities is due to be completed by the end of July 2008, the production permit is due to be awarded by the end of July 2008, with scheduled first gas production of 3mmscfd due to commence in the coming weeks. The Peneszlek gas development is centred on the development of the PEN-104 gas discovery that was drilled and tested by PetroHungaria in 2006. Post first gas production, it is planned to tie-in the PEN-9 and PEN-12 wells to increase production to near 7mmscfd. Further appraisal of the Peneszlek development area is planned at start 2009 with the acquisition of approximately 100 sq km of 3-D seismic in order to identify further prospects to be developed and connected to the production infrastructure. ZalaGasCo is currently finalising the development program for the Bajcsa gas re-development, which is one of three fields covered by the 50:50 joint venture with MOL. Permitting for the re-entry and horizontal re-completions of the identified existing wells is in progress, and various well productivity enhancement programs are being executed during Q3 2008 to improve the performance of current production wells. A total of 13 bcf recoverable reserves has been identified by ZalaGasCo, with the final sand targets currently being finalized for well entry in Q4 2008. David Lenigas, Executive Chairman, commented: 'The completion of our Investment Agreement in Hungary is another significant milestone for the Company, adding both immediate and near term gas production, and a third Country of operation in addition to our existing oil production in Spain and Trinidad. The two Hungarian assets both have significant production enhancement potential and demonstrate our continued strategy of delivering growth through the acquisition of proven reserves and the enhancement of producing assets. We look forward to working as a part of PetroHungaria and ZalaGasCo to maximize the value of both fields over the coming months.' Competent Person: The technical information contained in this announcement has been reviewed and approved by Fraser S Pritchard, Director of Operations for Leni Gas & Oil plc (member of the SPE) who has 20 years relevant experience in the oil industry. Leni Gas & Oil PLC David Lenigas, Executive Chairman Tel +44 (0) 20 7016 5100 Beaumont Cornish Limited Roland Cornish Rosalind Hill Abrahams Tel +44 (0) 20 7628 3396 Pelham PR Charles Vivian Tel + 44 (0)20 7743 667 Evgeniy Chuikov Tel +44 (0)20 3008 5506 NOTES TO EDITORS On 14 April, Leni Gas & Oil plc entered into a conditional investment agreement with Ascent Resources plc to acquire 7.27% interest in gas developments in Hungary. The Investment Agreement includes the acquisition of a net 7.27% interest in the Peneszlek gas development project, eastern Hungary; the acquisition of an effective 7.27% interest in the Bajcsa gasfield redevelopment project, western Hungary through the acquisition of 14.54% interest in ZalaGasCo, which will have a 50% interest in that redevelopment project; and a variation in the option to acquire a 10% interest in Ascent's Seeland Freinisburg Exploration Permit in Switzerland. This information is provided by RNS The company news service from the London Stock Exchange END ACQIFFLLDSIRLIT

Quick facts: Largo Resources Ltd

Price: 1.21

Market: TSX
Market Cap: $643.27 m
Follow

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

RNS