MetalNRG PLC (LON:MNRG) said on Thursday that the exclusivity period with regards to its acquisition of a majority stake in a Romanian company that owns the rights to an oil and gas concession for the next fifteen years has commenced and will run until 28 February 2020.
In a statement, the London main market-listed natural resource investing and exploration company noted that the process is ongoing per plan and initial indications, mainly from its site visit, are encouraging and suggest that the transaction could, based on current operational assumptions, meet the group’s investment criteria.
The company said the purpose of the exclusivity agreement is to set out the heads of terms upon which the purchasing parties will acquire 75% of the issued share capital of the operating company from the vendor, in consideration of an upfront payment and a free-carry component of the initial development capital.
It added: “Specifically, under our plan we intend to establish exploration upside for the project and that we can develop short term cash-flow from the asset under review.
“As a result of these initial indications, further work has been commenced and we plan to report back to market once the due diligence has been completed.”
Rolf Gerritsen, CEO of MetalNRG commented "The opportunity in Romania is significant and Pierpaolo Rocco, our Executive Director for Oil & Gas along with the Board of MNRG are extremely encouraged by the initial results from our site visit. We are working hard on this opportunity and will report back to market shortly."
Today’s statement follows news from MetalNRG, released late on Wednesday, when the firm revealed that it will blend material from waste dumps and mined ore to optimise gold production at its Gold Ridge project in Arizona.
The group said drilling will be carried out to delineate additional metal at the Gold Prince mine, which will be combined with ore from Level 6 and waste at Gold Ridge, the company said.