Parkmead, an independent oil and gas company, has completed an agreement with XTO UK to acquire a 15% interest in a number of blocks in the North Sea.
The blocks, namely 48/1a, 47/5b and 48/1c, contain the Platypus gas field and the Possum gas prospect.
The firm has been loaned £8m by Tom Cross, executive chairman of the group, to fund the acquisition and for the ongoing development of the assets acquired, including drilling, the company said.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
In a statement the firm said: "This acquisition marks an important step in Parkmead's first stage of its development to become a significant new independent oil and gas company. We know the geotechnical aspects of these blocks intimately and believe they contain the potential for significant upside."
The Platypus gas field has the potential to contain up to 180bn cubic feet of gas in place, while the Possum structure has an estimated resources of approximately 100bn cubic feet of gas in place.
The operator, Dana Petroleum, holds a 45% stake and has secured a rig to drill a well on the Platypus/Possum complex scheduled to start in the first quarter of 2012.
The loan will also be used for funding general working capital and future corporate purposes. It will have a tenor of two years, with an interest rate of 2.5% above the average interest rate that leading banks in London charge when lending to other banks, and it will be secured by a standard floating charge provided by the group.
The share price rose 25.49% to 16p by 13:37.
NR
-
Ticket scam warning ahead of major summer eventsA total of £6.7 million was lost to ticket scams last year. With the Taylor Swift Eras tour and Glastonbury Festival coming up, we explain how to stay safe when buying tickets
-
GDP: UK economy exits recessionThe latest GDP figures reveal the UK economy grew by 0.6% in the first three months of the year, officially exiting recession. We look at what households and investors can expect next.
