Shares in oil and gas investment company TXO (LON:TXO) rose nearly 14% on news of a favourable verdict from a New York court case involving Empire Energy (ASX:EEG).
The AIM-quoted energy resource firm owns a 25% indirect stake in Empire, which was being sued by Smart Win over oil drilling funding in Tasmania dating back to 2008.
TXO said a New York judge denied the A$2mln motion by Smart Win while ruling that Empire could proceed on its breach of contract counterclaim against the firm.
A TXO statement said: “Justice Oing determined that the 2008 agreement between Smart Win and Empire did not preclude the possibility that Empire's costs in drilling for oil in Tasmania might exceed a A$5mln funding commitment by Smart Win reflected in the 2008 agreement.
“The judge noted the fact that Empire's prediction that the initial drilling costs might exceed A$5mln did not entitle Smart Win to ‘turn off’ the funding ‘spigot’ of up to the A $5mln commitment even if Empire, as it pursed [sic] its drilling efforts based on Smart Win's commitment of as much as A$5mln, faced the possibility of cost overruns beyond the A$5mln.
“According to its own complaint, Smart Win stopped making advances after it had advanced only approximately A$3mln of the A$5mln.”
TXO shares were eventually trading 10.34% higher at 0.16p at 10.00am.