PAN Andean Resources, the AIM listed exploration company headed by Dr John Teeling, will have to raise more money to maintain its 20 per cent interest in the Chapare oil prospect in Bolivia.
In a statement with the group's interim results, Dr Teeling said. "I hope and expect to need money to maintain our 20 per cent interest in Chapare. Our agreement with BHP gives us a 20 per cent free carry on the first well and 10 per cent in the second. We can maintain our 20 per cent interest by funding the 10 per cent differential."
Dr Teeling did not indicate how much Pan Andean would need to raise to maintain its full 20 per cent stake in Chapare, but the well being drilled currently by BHP is costing over $7 million (£4.37 million). Dr Teeling said he believed this well will be the first of a number to be drilled on the Chapare block.
Pan Andean joined the Alternative Investment Market in London in September 1995 and since then the number of shareholders has risen from 500 to 3,000. The company now has three market makers Jenkins, Winterflood and Merrill Lynch.
The half year results include an exceptional charge of £66,562 relating to the costs of the AIM listing.
Since Pan Andean floated on the AIM, the shares have risen strongly, particularly since the joint venture in Bolivia with BHP was announced. The company was floated on AIM at 323/4p, fell back to a low of 171/4p but hit a high of 1281/2p this week as speculation on the outcome of the Chapare well intensified.
