MX Oil has signed terms with an international oil and gas group to buy its Nigerian assets in the proven offshore Aje field.
Under the terms of the proposal, the company will receive $18 million for the sale subject to conditions.
Up to $3.5 million will be advanced to the company to finance the asset to production.
The Aje field, which was discovered in1977, is thought to have a similar composition to Ghana’s Jubilee field.
The proposed purchaser will then have the right to acquire the investment, which is most likely to be when initial oil production commences, following which, the remaining money will be paid in installments.
MX Oil said the transaction is still subject to contract and the completion of due diligence.
The company has also aims to raise £560,000 from a shares placing.
It said it will continue to review all of its financing options and in order to maintain maximum flexibility, and will proceed with a reorganisation of its share capital following a shareholder meeting on February 18 when it will seek shareholder consent to issue new ordinary shares at a price below 1 pence.