San Leon Energy (AIM: SLE) has tapped into Iraq's potential with a joint venture with Baghdad-based Al Meinaa Oil Services Limited for joint evaluation of oil and gas projects in the country.
Under the terms of the JV, the partners will have the right of first refusal to evaluate a potential project identified by the other party and a 60 day period of exclusivity to review the project further if it wishes to do so, which would be followed by a shareholders agreement to govern the project.
Al Meinaa was established in 2003 to provide services including reservoir modelling and geological and geophysical studies as a partner to international companies. The company has compiled information on numerous fields around Iraq, including the Ajeel, West Qurnah, Mansouria, Akkas and Bani Hassan fields.
In February 2009 Al Meinaa signed a 40 year lease for a large land site in Basrah, with South Oil Company, for the development of an oil and gas supply base. Its management consists of senior Iraqi engineers.
Following agreement of the parties' joint participation in a project and the execution of the shareholders agreement, San Leon has agreed to issue to Al Meinaa warrants to subscribe for 10 million ordinary shares in San Leon at a price of 22 pence per share, compared to the stock’s current price of 20 pence per share.
San Leon said it had been looking to establish a presence in the region “for quite some time.”
“Iraq represents an incredibly exciting opportunity for San Leon as the country's potential is well documented... as such we are delighted that we have been able to secure this exclusive partnership with such an excellent local resource in Al Meinaa. This partnership will help provide access to and evaluation of, the suitable opportunities available to us in Iraq,” said Chairman of San Leon, Oisin Fanning. http://www.proactiveinvestors.co.uk/companies/news/11914/san-leon-energy-sets-up-jv-with-al-meinaa-to-evaluate-oil-and-gas-project-in-iraq-11914.html
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