White Nile shares on the way back

SHARES in White Nile, the oil minnow set up by former England cricketer Phil Edmonds, make their long-awaited return to trading on the Alternative Investment Market (Aim) on Monday.

Dealing in White Nile stock was suspended at 138½p in mid-February after a 13-fold increase in the share price in only five days as investors went into a feeding frenzy over the prospects from its deal with the government of South Sudan to work on a huge area of land near the Kenyan border.

Today White Nile said it would issue 155m shares at 0.1p each to pay for the oil concession with the South Sudan government known as Block B.

The new shares will be issued to a company set up by the government called Nile Petroleum Corporation (NPC). The deal will mean the Sudanese government will own half of White Nile via its stake in NPC.

The deal with Sudan will give White Nile 60% of the gross revenues from any oil discovered in return for the British firm bearing all of the costs of exploration, development and production.

The Sudanese government could end up owning 70% of White Nile by exercising an option to transfer NPC's interest in the oil concession to White Nile in return for the issue of more than 206m more White Nile shares.

Frank Timis is stepping down as chief executive of oil explorer Regal Petroleum but will stay with the firm as executive chairman.