Roxi Petroleum (RXP) Announces Completion of First Stage of BNG Farmout

Today Roxi Petroleum (AIM:RXP) announced the completion of the first stage of its agreement with Canamens to dispose of part of its interest in the highly prospective BNG Contract Area (aka Ayrshagyl).

The revised deal was announced in October and ratifed at a General Meeting on 17 November.

The first stage has involved Roxi transferring at 23% interest in BNG to Canamens in return for $32m plus a $2m completion payment.

Canamens now have until 31 March 2010 to decide whether to complete on the second part of the deal which would see Roxi transferring a further 12% interest in return for a further $23m.

This $32m is going to be used to drill prospects on the BNG block, probably starting with the already discovered G-54 structure in the Cretaceous/Jurassic, and potentially a deeper well to test the as yet undrilled Triassic prospect that appears to lie beneath. We do not yet know whether and when Roxi will drill the previously discovered G-1 prospect (which tested oil at ~2,000bopd) in the Lower Permian or the G-7 Jurassic target.

At the AGM in July 2009, it was suggested that a further 2D/3D seismic programme on the south of the block may also commence during 2010.