CHK Oil (00632.HK) announced on August 15 that the group has the right to extract oil and gas from the oil field in Utah, USA through the four leases signed with the US Department of the Interior. The company recently learned on August 9, 2024, that the Department of the Interior issued a written order on November 14, 2022, which stated that the Department of the Interior believed that three of the leases had expired on July 31, 2020, and March 31, 2021, respectively.
The company reported to the board of directors only recently that it had received the aforementioned written order. The company will further investigate the reasons for the delay in reporting. The company is now seeking legal advice from its legal counsel in Utah to assess the legal impact and fines (if any) of the relevant leases and orders issued by the Department of the Interior, as well as feasible legal actions that can be taken under applicable laws.
The group has strategically invested more resources in oil, oil-related products, and other product trading businesses. The oil and gas fields involved in the relevant leases have not carried out any operation or mining activities in the past few years. Therefore, the board of directors believes that, based on the information available to the company on the date of this announcement, the termination (if any) of the relevant leases will not have a significant adverse impact on the group's business operations.
In addition, the company has applied to the Stock Exchange of Hong Kong to resume trading of the company's shares starting at 9:00 am on August 16, 2024.