OEX was the big winner among ASX-listed energy companies last week, rising 33.3% to close at 26 cents yesterday, up 10.6% for the month.
Olilex has come up with a sound development plan for the area surrounding Rookwood, south-west Queensland, but more importantly it has established a foothold in India and signalled it intention to build a new core region in that country.
“We are actively investigating further exploration and production opportunities in India,” said managing director Bruce McCarthy.
During the June quarter, the company participated in the NELP 5 tender round in India, lodging joint bids over three exploration blocks.
It also established Oilex India Pvt Ltd as the operating vehicle for its Indian operations and concluded a consulting agreement with India Hydrocarbons Ltd to assist in acquiring oil and gas exploration and production assets in India.
In July, Oilex also concluded a heads of agreement to acquire a 30% interest in the Production Sharing Contract covering the Cambay Field located onshore Gujarat, Western India, farming into a Gujarat State Petroleum Corporation (GSPC) and Niko Resources joint venture.
"The field is located in one of the most prolific petroleum provinces onshore India close to existing pipeline and industrial infrastructure," McCarthy said.
"Oilex will become the operator under the existing PSC and joint operating agreement and will earn its 30% participating interest by undertaking an exploration and development work program of a value equal to 30% of the costs incurred by GSPC and Niko to date."
Investors are excited, not only because India is a rapidly growing, energy-hungry market, but also because new Oilex MD Bruce McCarthy has a strong background in Indian exploration and production. He is a former Cairn Energy India president. He was executive director of Command Petroleum India Ltd based in India when Command merged with Cairn Energy in 1997.
Oilex will operate its new block and it saw this acquisition as the first important step in establishing its presence as an operator in oil and gas exploration and production contracts in India, McCarthy said.
Exciting times for the company, but a long way from the heady heights of last November when OEX went as high as $1.25 on speculation over Rookwood.
