UK-based producer JKX Oil & Gas has opted to offer its remaining investors an opportunity to trade their stock on a secondary independent market facility after the company was delisted from the London Stock Exchange at the end of December.
JKX said in a statement this week that it has appointed UK-based financial services platform Asset Match to handle transactions in its shares as shareholders appear to have not been put off by increasing geopolitical risks to the company’s oil and gas business in Ukraine.
The platform will allow existing and new investors to trade ordinary shares by matching buyers and sellers through periodic auctions, the company said.
Based on the current indicative price of JKX stock on the Asset Match website, it has barely changed from last December, with the market capitalisation of the producer currently estimated at little over £58 million ($79 million).
But many minority shareholders in the producer have decided to retain their holdings after the delisting, with a January offer from JKX to buyback over 40 million of its shares resulting in just 26.9 million shares surrendered by stakeholders, according to an earlier statement of the company.
A wholly owned subsidiary of JKX operates several fields in Ukraine's Poltava region, provides the bulk of company’s revenues.
Poltava lies next to the Kharkov and Sumy regions in the eastern part of Ukraine.
According to western analysts, Kharkov and Sumy may become first targets for a possible Russian military invasion into the country, as the Kremlin is understood to have amassed over 100,000 soldiers and military hardware close to Russia's borders with these two regions.
JKX output was declining in the first half of last year, with the Poltava assets producing little more than 4000 barrels of oil equivalent per day, but began improving in the third quarter.
Gas prices have soared by 150% over the last year in Ukraine, reaching $305 per thousand cubic metres, according to an earlier JKX statement.
However, despite efforts from authorities to stimulate investments in brownfield recovery projects, the country's total gas production declined by over 2%, to total 19.8 billion cubic metres, last year, according to state-run company Naftohaz Ukrainy.