Petroneft secures $5m credit line to speed up exploration in Siberia
PETRONEFT Resources, a Dublin-based oil explorer operating in western Siberia, has signed a $5m (€3.7m) credit line with Macquarie Bank to speed up its exploration programme.
The loan makes $2m available immediately, Petroneft said yesterday. It is in negotiations with banks for a bigger loan to provide capital to ramp up development of its two licences in Russia.
PetroNeft has found oil in Siberia, which recently overtook Saudi Arabia as the world's biggest oil producer, and is looking for further wells. Production is expected to be 4,000 barrels per day in 2010 growing to 12,000 barrels per day by 2012.
Shares in the company, which owns four proven oil and gas fields, as well as more than 25 prospects in the Tomsk Oblast region of Russia, have more than tripled in the past 12 months. It plans to drill nine production wells and complete construction of a 60km pipeline by the end of this year.
"This facility enables us to accelerate our exploration programme in the northern part of Licence 61 by drilling one high impact exploration well in 2010," chief executive officer Dennis Francis said.
"Two additional wells will be drilled in 2011, all of which, if successful, can be quickly brought into production, utilising the Lineynoye facilities."
The news was welcomed by analysts. Joe Langbroek of Davy Stockbrokers said it "firmly underpins our 'outperform' recommendation". Shares were little changed in Dublin and London yesterday.