Last month Jacka announced a potentially life-saving agreement with London-based Cornhill, under which Cornhill would take a $US1 million placement in Jacka and organise funding of the Nigerian development costs from May 1 through a private placement of shares in and/or loans to the Aje field holding company by Cornhill or a company listed on the UK's Alternative Investment Market nominated by Cornhill.
In return Cornhill will be assigned inter-company loans due from Jacka's subsidiary PR Oil & Gas Nigeria in exchange for $US3 million in shares in MX.
If MX completes the transaction it will secure all of the economic benefit of Jacka's interest in the Aje field, and Jacka could benefit via its 11.47% interest in MX.
The shares in MX will be issued at the price at which MX is currently undertaking a capital raising to assist in funding the Aje Phase 1 field development program.
"This investment builds on MXO's strategy to acquire high impact near term production assets in proven oil and gas jurisdictions to build a cash generative platform," MX CEO Stefan Oliver said.
MX was formerly known as Astar Minerals, a company formed to consolidate the mineral claims over a land package situated on the Sechelt Peninsula, British Columbia, Canada and to develop the claims in order to produce industrial minerals and construction aggregates.
It ran into trouble when it was unable to proceed with its operating contract to manage its operations after a failed reverse takeover left it cash-strapped.
In mid-2014 it announced a new plan to enter the emerging Mexican energy sector in partnership with Geo Estratos, established oil services business in Mexico that provides services to Pemex, Mexico's national oil company.
The partnership is still involved in Mexico, having been formally listed as interested parties in Phase III of Bid Round 1 by the National Hydrocarbons Commission, two of 16 interested parties who can now access data rooms.
It believes the Aje opportunity is the near-term production it has been seeking in order to fund its Mexican ambitions.
Jacka had a 5.0006% revenue interest (6.675% contributing interest) in Aje, and needed to find funding for the initial development of the Cenomanian oil project, re-entry of the Aje-4 well and the drilling of a new well, Aje-5, supporting a 10,000 barrel of oil per day floating production storage and offtake development.
MX expects to gain revenue from a net 500bopd.
Jacka is still recovering from a disastrous aborted merger with Tangiers Petroleum and had been facing a $12.1 million bill for its share of the Aje development.
It has already been forced to writedown the value of Aje by $20 million.
Jacka says with the threat of non-performance over Aje lifted, it can now identify and pursue new early stage oil and gas exploration opportunities to add to its existing portfolio of interests.
Jacka's remaining assets include the risky Hammamet West field, offshore Tunisia, a right to back-in to its former wildcat licences in Somaliland, and 100% of the frontier Ruhuhu basin application in Tanzania.
Jacka had $3 million in cash at the end of the last quarter.
The company last traded on January 5 at $0.034.
elopment, offshore Nigeria.
