News blog
TomCo Energy
- BY: Andrew Hore |
- POSTED: 03/09/2009 |
TomCo Energy, whose Aim quotation was cancelled on 12 August 2009, has taken its dispute with Avenue Group Inc over its Israeli oil and gas assets to arbitration in Tel Aviv.
In April 2009, Avenue said it wanted to terminate its agreement with TomCo.
TomCo and Avenue are partners in the Heletz oil field in Israel. TomCo owns a 50% working interest in the Heletz Licence and a 25% working interest in the Iris Licence which is in the centre of the Heletz field. There are four producing wells in the main licence area. At the end of 2008 production was running at around 50 barrels of oil per day.
TomCo paid $1m and issued 12.62m shares at 2p each to acquire 50% of the Heletz-Blur-Kokhav licence and 25% of the adjacent Iris licence. It has also made a contribution of $107,000 to past costs and will pay up to $4.5m in development costs over the next three years.
TomCo says that it has paid $2.9m in total to Avenue so far.
Avenue claims that TomCo has not paid all the additional cash it is supposed to. TomCo says that Avenue has failed to provide TomCo with information about the operations.
TomCo argues that Avenue is in breach of the agreement so TomCo should not have to pay up until Avenue has delivered on its side of the bargain. It wants the arbitrator to force Avenue to remedy the breaches and award TomCo damages.
The shares were suspended on 11 February 2009 at 0.35p each, which valued TomCo at £1.88m. The financial position of the company remains uncertain and the quotation was cancelled six months later.
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