By John Lee.
Irish-based Petrel Resources has taken a €4.1 million impairment of its investment in Iraq:
"In August 2013, Petrel did a deal with Amira in Iraq whereby, for US$500,000 in cash plus 18,947,368 initial consideration shares (which were to be locked-in until spudding of the first oil well by our partners), Petrel acquired a 5% full free carry in Amira's activities in the Wasit province in Iraq which was then, and still is, a relatively stable Shia dominated province.
"The expectation was that provinces in Iraq would offer licences in their own right rather than solely through the central government in Baghdad. This did not happen. In fact, nothing happened. As mentioned above, we have therefore impaired our investment."
However, the company said it remains interested in oil opportunities in Iraq:
"Iraq remains one of the very best oil provinces in the world. The oil exploration potential is outstanding. The improving political situation in Iraq has resulted in Petrel re-awakening an interest. We have been there since 1999 and like the country.
"We are discussing with Amira, our partner, how best to declare an interest in certain fields. We are also re-establishing contacts in the administration. It is very early days, but it does look as if Iraq is slowly re-opening for business, and we want to be there."
(Source: Petrel Resources)