Monday, 19 July 2010
MOG terminates Max Petroleum’s Astrakhanskiy license
Max Petroleum has receive a dispatch from Kazakhstan’s Ministry of Oil and Gas (MOG) informing the company of the government’s decision to terminate Max Petroleum’s subsoil use license for the Astrakhanskiy Block in Western Kazakhstan. The agreement was said to be terminated due to Max Petroleum’s failure to comply with certain work obligations, stipulated under the license.
It is thought that MOG’s decision reflects a greater change in the treatment of subsoil use licenses. The decision does not affect the company's key asset, the Blocks A&E license area. The news of the termination comes shortly after the company’s decision to put on hold drilling of an exploration well, without a partner.
Max Petroleum has received assurances from its senior lender, Macquarie Bank Limited, and the holders of greater than 85per cent of its convertible bond holders that a termination of the Astrakhanskiy License would not constitute an event of default under the company's outstanding debt agreements. The company has expressed that it considers MOG's action as a preemptive one and is trying to arrange negotiations with MOG to discuss alternatives.
To find out more about Max Petroleum please visit Max Petroleum’s web site, which you can find here.
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