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Friday, 10 May 2013
Transeuro Energy says conditions for Povorotnoye funding close to being met
Transeuro Energy Corp. (CVE:TSU) shares were running higher Friday after it said that its partner Aleator Energy (ASX:AWD) completed a $2.7 million financing that will allow that company to meet most of the conditions of a US$20 million loan to support the drilling obligations under a farm-in deal between the two parties on the Povorotnoye gas field in Crimea, Ukraine.
The funds raised by the placement will allow Aleator to satisfy two of the conditions under the $20 million loan agreement announced in late March - that is to have net available cash of at least $1.5 million at the date of the first drawdown, and to pay all expenses and legal fees prior to the drawdown.
The remaining condition, to execute and register as necessary all finance and security documentation, is currently bein taken care of, and is expected to wrap up shortly, Transeuro said in a release Friday.
As a result, the first tranche of the loan of US$10 million is anticipated to be drawn down immediately afterward.
Transeuro Energy is a junior oil and gas exploration and development company with properties in Canada and in Ukraine.
It has retained a 10.8 percent interest in the joint activity agreement to develop the Povorotnoye gas field. Under the terms of the farm-in deal, the company will receive US$500,000 upon spudding of the POV 105 well.
Aside from being used for the POV 105 well, the $20 million in funds will also be allocated for the provision of a pipeline and plant to process and delivery anticipated gas and condensate when the well is completed and prepared for production.
Shares of Transeuro were up by one penny to 6 cents on the TSX Venture on Friday.