Maverick Drilling reaffirms timeline on deal with Gulf South, drilling on high impact well underway 

(MENAFN - ProactiveInvestors - Australia) Maverick Drilling & Exploration (ASX:MAD) has reaffirmed its intent to finalise negotiations with Gulf South Holdings by end of this month and also to continue with the drilling of a high impact well.

Maverick reiterated its commitment in response to a price query by the ASX, which asked the company to respond to the sudden drop in the stock price o an intra-day low of 0.75 cents a share earlier today from a close of 0.96 cents yesterday.

Maverick confirmed that it was in the final stages of negotiations with Gulf South and expected to have finalised negotiations on or shortly after 30 November.

It had entered into a non-binding Memorandum of Understanding (MOU) with Gulf South Holdings for developmental drilling of its shallow salt dome acreage.

Under the MOU Gulf South has the right to participate in the joint development of 400 or more wells, representing a capital commitment of US 100 million, across the shallow oil fairways of Maverick's three salt domes over the next three calendar years to end of 2015.

It had also completed an underwritten A50 million equity raising, part of which was to be used to fund a drilling of high impact wells identified through both 2D and 3D seismic.

Maverick confirmed that drilling of one of those wells was currently underway. However, the well is yet to reach the designated depth and no testing has been done on the well yet.

The company explained the sudden drop in price to a number of warrant products with stop loss levels in the range of 0.96 cents to 0.75 cents, which may have been triggered and caused volatility in the security.