President Energy cuts price of Puesto Guardian acquisition by a third

The site was initially expected to cost the oil explorer $17.9m but it will now pay $5.8m.

In July, the firm agreed to pay $5m for the 50% not under its control and an additional $1.99m in cash over a 24-month period as well as committing to make a series of royalty-based payments, capped at $11m in total, dependent on production of over 1,000 barrels a day.

President has since amended the deal, agreeing to pay $800,000 to take control of the half of the field it didn’t already own, while the deferred payments and contingent royalty have been cancelled.

"We are delighted to have taken operatorship and 100% ownership of Puesto Guardian at these revised terms. This opportunist transaction relieves President of actual and contingent liabilities arising from the acquisition totalling $12.88m in consideration of an accelerated discounted sum of $800,000," chairman Peter Levine said in a statement.

The group added it had renewed a $15m unsecured loan with IYA Global until the end of 2015. The loan pays a 2.5% facility fee and carries a drawn interest rate of 12.5%, or a 5% commitment fee if it remains undrawn.

"The extension of the loan facility will continue to provide President with operational flexibility," said Levine.

President shares were down 7.56% to 27.50p at 14:17 on Monday.