JKX signs Russian gas sales contract

JKX Oil & Gas has announced that its wholly owned Russian subsidiary, Yuzhgazenergy, has signed a sales agreement with Kubangazifikatziya for the sale of 100% of the gas produced in 2012 from its Koshekhablskoye field in southern Russia.

Kubangazifikatziya will take delivery of gas from the Koshekhablskoye field at the export flange and will be responsible for transport through the Gazprom pipeline network to end users.

"Conclusion of gas sales negotiations is an important milestone," said Chief Executive Paul Davies.

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"This contract gives us flexibility on both initiation of delivery and volumes during the ramp up period. We are delighted to be working with an established supplier as we enter this exciting market."

JKX will commence deliveries shortly after receiving its Permit to Operate from the Russian authorities in Moscow.

Shares gained 7.92% to 143.00p in mid-morning trade.