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TXO

  • BY: Andrew Hore |
  • POSTED: 30/06/2011 |

Shell company TXO has completed the purchase of a 10% stake in Grand Bahama Group Ltd.

TXO paid £500,000 for the shares and has been granted a six month option, in two parts, that enables TXO to choose to increase its stake to 42.2% for a further investment of £3.45m. TXO has also lent £112,500 to the GBG.

TXO will still have net cash of around £100,000.

GBG has acquired Morgan Oil Marine and Morgan Oil. Morgan Oil Marine is the exclusive BP Marine distributor of lubricants for the Bahamas. The business has conditional approval to base its operations at Freeport, Grand Bahamas. There are also plans to collect waste oils. There has been $204,000 invested in the business, which has not generated any revenues.

Morgan Oil has majority interests in eight leases, on which there are currently 16 wells, in Western Kentucky. There are an estimated 400,000 barrels of recoverable reserves.  That would be worth $22.75m at $65/barrel. However, these estimates are based on a method not compliant with Aim standards. A third party has often to fund a horizontal well.

At 0.68p a share, up 0.15p, TXO is valued at £2.22m.

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