PetroNeft deploys two new drilling crews to Russia
Irish oil and gas explorer PetroNeft has restarted drilling at two sites in the Tomsk region of Siberia, Russia.
The renewed activity is not expected to be directly impacted by sanctions imposed on Russia by European and US authorities in the wake of the escalating Ukraine crisis, according to company sources.
That's because the output from the wells is destined for the internal Russian market, not for export, the source said.
It follows an $80m (€60m) deal with Oil India in July to "farm out" development of PetroNeft's Licence 61 rights.
Under the terms of that deal the first $35m of the farm out proceeds were used to cut PetroNeft's debts to lenders Macquarie and Arawak. The company is now debt free.
The balance is earmarked for exploration activity.
PetroNeft said yesterday it is mobilising two drilling crews at its Tungolskoye No. 5 well and the Arbuzovskoye oil field - both in the Tomsk region.
The Tungolskoye well will be the first horizontal well drilled on Licence 61 and is expected to take 60 days to complete.
Shares in PetroNeft were up 4.22pc yesterday to 7.4 cents each in Dublin.
Before the Oil India deal PetroNeft had come under sustained pressure from biggest shareholder, Natlata, over slow progress developing the Russian asset.