Share prices for Siberian oil recovery corporation RussOil (OTCBB: RUSO) plummeted just over 50 percent this morning after the company announced its subsidiary, Smolenergy, entered into a contract with Selection Oil to sublicense Selection’s “Perm” license for a 52,000-acre area in Bashkiria rich with proven and crude oil reserves.”Should the merger between RussOil and Smolenergy be consummated as expected, Smolenergy will become a wholly-owned subsidiary of RussOil, and Selection Oil will receive 4 million unregistered shares of RussOil common stock in consideration for ownership of the Perm license,” the press release stated.
Once RussOil completes its acquisition of Smolenergy, the company will have unlimited access to the Gorstovoe oil field in West Siberia.
“We are pleased to see Smolenergy continue its strong record of asset expansion,” RussOil CEO Silvetre Hutchinson said in the release. “With RussOil as a strategic partner, our combined firms will enjoy a strong position in terms of acquiring and extracting additional reserves. We look forward to closing the merger with Smolenergy as soon as possible.”
Despite this positive news, prices for RussOil dropped 56.69 percent, or 89 cents, by 10:30 a.m. CDT to 68 cents per share.
Calls made to RussOil for clarification about the drop went unreturned.
