Petroneft bets on $35m Indian Oil deal
PETRONEFT'S biggest shareholder has said the Irish-based oil and gas explorer has put forward "no solutions" apart from spending more money amidst a conflict over the company's direction.
Dublin stock exchange-listed Petroneft yesterday announced that it had agreed a major work programme for its west Siberian project with Oil India as partner.
That plan includes a commitment by the Indian company to fully cover costs at joint venture through a $35m loan.
It was announced in the teeth of attempts by Petroneft's own biggest shareholder, Natlata, controlled by Russian businessman Maxim Korobov, to replace the listed company's entire senior managament at an extraordinary general meeting (EGM) called for April 18.
The deal with India Oil will only stand if Mr Korobov's proposals are voted down at the EGM.
Ahead of that meeting, Petroneft yesterday called on shareholders to vote against all of Natlata's resolutions, which include the appointment of three new directors, Anthony Sacca, David Sturt and Maxim Kirobov.
Natlata is also looking for the removal of four current directors in Dennis Francis, David Sanders, Paul Dowling and David Golder.
The PetroNeft board says Natlata is seeking to get control of the board without having to pay the shareholders a fair price for obtaining the company.
Maxim Korobov denied that.
"Our proposals are aimed solely at unlocking the value of company for the benefit of all shareholders.
"In the next week we will be sending out our response and look to having a full and open discussion with shareholders in the run-up to the EGM," he said.
"It is immediately apparent that the board offers no solutions of its own, except spending more money," Mr Korobov said.
However, PetroNeft chief executive Dennis Francis said the agreement of the programme and budget was a major step forward for the development of License 61.
Principal payments on the proposed loan would not fall due until 2019, he said.
"Given the challenges currently being experienced in the market, the ability to secure this funding is a major positive for the company," he said.
Natlata, meanwhile, has signalled that it could launch a takeover bid of PetroNeft. Shares in Petroneft closed unchanged yesterday at 3.20 cents each.