Roxi Petroleum (RXP) finally seals the BNG Farm-out Deal with Canamens

Back in July Roxi Petroleum (AIM:RXP) announced the terms of a farmout deal with Canamens, whereby in exchange for 35% of BNG, Canamens would fund up to $50m of the 2009 and 2010 work programmes for the BNG asset. Under the terms of that arrangement, Roxi would end up with 37.96% of BNG. This deal was ratified by shareholders at a GM held on 12 August.

In September, with the interims, they made a further announcement that the terms of the deal were being re-negotiated, and a further separate but associated agreement with Baverstock, so they could be released from further work programme commitments.

Yesterday, Roxi announced the details of the new transaction. This deal means that Roxi's additional work commitments are reduced to $8m, in return for reducing its eventual stake in BNG to 23.41%. Whilst it is disappointing that the final stake is BNG is being reduced so dramatically, it is undoubtedly good news that funding issues have now been resolved and the path is clear to commence drilling; hopefully in the near future.