Luxoil 1:1 free options issue

Press, 13 March 1986, Page 27

Luxoil 1:1 free options issue

PA Wellington Luxoil N.L., the small Wellington oil explorer, is issuing free options which are exerciseable in time for a tax deduction for this financial year, the company’s annual report says. Luxoil will issue up to 8,695,626 options on a one-for-one basis.

The options are exerciseable in whole or part up to March, 1989, at 25c. Option certificates will be mailed out as soon as possible after March 24 which will have an application attached. If shareholders receive the documents before the end of this month they will be able to subscribe for shares immediately and qualify for a deduction against income equal to one-third of amounts subscribed, the report says.

The existing shares are trading at 22c a share, 3c below the exercise price of 25c. Listing for the options is being applied for.

The chairman, Mr Dan

Lux, says in the report he was disappointed the partners of the Card Creek No. 1 well in Westland decided not to test it, in spite of two gas kicks encountered during drilling. But further drilling in the licence area is likely later this year, after a 100 km seismic survey, he says. The Pukearuhe No. 1 well in licence area 083 (Taranaki) should be spudded in April while in the adjacent licence area 084, another 75km of seismic will be run.

An extended production test of Niagara No. 1 well in Westland will start this week, with another two wells drilled in the area after that.

The company has participated in nine wells in little more than a year it has been incorporated and, of those, the Niagara well is an oil discovery, he says. Luxoil has interests in five licence areas.

The company policy at this stage is to concen-

trate on onshore exploration because of its lower costs.

To spread the risk the company is involved in three prospective sedimentary basins, and hopes to become the operator responsible for managing new exploration areas. This year Luxoil will be involved in at least four wells and 175 km of seismic work. The accounts show exploration interest of $2,795,128 capitalised. Capital commitments within the next year total $576,346 spread over three licence areas. Creditors include $224,106 in exploration spending. The company has issued an option to Oilfields, N.L., and United Resources Investment Holdings, Ltd, to subscribe for up to 15 per cent of its issued capital before June 30 and for Mainzeal Group, Ltd, to subscribe for 500,000 shares before December 31. The company currently has 6,891,282 shares on issue.