PetroNeft gets approval for farmout with Oil India

PetroNeft Resources has received Russian regulatory approval for the farmout of an interest in its Licence 61 site to Oil India.

The oil and gas company said formal completion of the transaction and receipt of funds is expected in the coming days, with debt due to Macquarie and Arawak banks repaid from the initial proceeds of $35 million.

PetroNeft chief executive Dennis Francis said all of the conditions precedent on the Licence 61 Farmout have been fully satisfied, adding that the company will re-commence drilling at Licence 61 shortly.

The T-5 well at Tungolskoye will be the first horizontal well drilled by the company and is expected to take approximately 60 days to drill.

Dublin-headquartered PetroNeft last week reported a pre-tax loss of $11.5 million for the 12 months to the end of December, up from a loss of $2.8 million a year earlier.