Entek has agreed to issue 12,500,000 options expiring on December 31, 2009 to the Lenders. The options are exercisable at 20 cents each and are on the same terms and conditions as the existing options expiring on the same date.
The purpose of the loan facility is to provide finance for the Entek's development costs for the High Island 24-L Block, exploration activities, administration expenses and working capital for a short period pending the commencement of revenue from Entek's existing discoveries in the Gulf of Mexico and Australia.
Entek previously announced that production from the High Island ST 24-L (S/2 SW/4) #1 discovery well in the Gulf of Mexico, was expected to commence in April to May 2007. The expected production start-up date has now been deferred to July 2007 due to delays in the delivery of specialized equipment required for the pipeline.
The Byrock-2 well in ATP269P oil discovery (announced in November 2006) in SW Queensland is expected to commence production in May 2007, subject to completion rig availability. Completion of the well has been delayed due to heavy rains in the region.
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