Unpaid $25m bill lands Xstate’s errant investors in court
A $25 million unpaid bill has landed oil and gas explorer Xstate Resources and four errant investors in court.
On Tuesday, Xstate (ASX:XST) asked the Supreme Court of Western Australia to impose a November deadline for a summary judgement application, a procedure allowing the parties to avoid a trial.
The case itself is over non-payment of $25 million by four Asian investors, part of a larger sum Xstate needed in order to buy the Los Angeles Basin oil and gas fields.
Despite months of constantly being reassured by the Indonesian bank in charge of the transaction — and reassuring the market — the money never arrived in Australia.
In March, Xstate said that despite receiving a number of documents provided as evidence the transfer had taken place — they never saw the cash.
The deal to buy the Los Angeles Basin oil and gas fields fell through in April, and an irate Xstate then launched legal proceedings.
“Xstate will continue its efforts to reach a satisfactory and swift resolution of its claim for damages including damages for loss of opportunity relating to the investors’ breach of contract and the consequent losses suffered by the company,” it said.
Xstate has been trading between 0-3c over the last year, with its current share price hitting 0.8c. It’s worth about $5.8 million, and says it wants to move from exploration into running producing oil and gas fields.
Currently the company’s only project is a gas exploration development in California, in which Xstate owns a 10 per cent working interest, meaning it owns a share of the profits and is responsible for paying for a share of the work.
Xstate had $649,000 in the bank at the end of June, plus $470,000 later raised from private investors.