Hard-pressed Colombian oil explorer PetroLatina has clinched a £15 million refinancing and won a key licence extension.

The AIM-quoted company, which lost £1.5 million in the first half of this year, says it has slashed head office costs and claims to be on track to produce 10,000 barrels of oil a day by the end of 2008. This is claimed now to be possible because PetroLatina's state-controlled partner Ecopetrol has obtained an indefinite extension for its Tsquirama licence and the New York-based Casimir banking group has arranged a £15 million refinancing package.

According to PetroLatina, the new funding, in the form of a 13 per cent to 15 per cent one-year loan convertible into shares at a ten per cent premium to market price, will enable the drilling to proceed at La Paloma in Colombia, with claimed potential oil reserves of 16 million barrels, and to probe a new well there. Juan Carlos Rodriguez, 46, the Colombian oilman who has newly taken the helm at the London-based company and personally invested £1.5 million, says PetroLatina will begin 'aggressive' drilling at La Paloma within a week.

PetroLatina will then proceed to infill drill at four 'low-risk' wells at Los Angeles on the Tsquirama licence, where Rodriguez expects eight new wells at the Santa Lucia project to treble production to 3,000 barrels a day. The shares, which fell all the way from 72.5p in 2005 to 10.25p last month, have inched up since then to 11.5p, valuing the company at £13.8 million and offer the speculative possibility of further progress if the new package proves adequate and works.

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PetroLatina Energy	AIM	£7.57m	17.25p	0.00p
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