Oil and gas exploration and production firm Leed Petroleum has acquired a 17.5% interest in Manas Coal.

Manas is mainly engaged in the exploration and development of coking coal resources and deposits within the Kyrgyz Republic.

Leed has advanced a sum of £750,000 to Manas by means of a loan, and will issue 166,666,667 ordinary shares to existing shareholders in Manas at a price of 0.15 pence per share, together with 166,666,667 warrants to subscribe for new ordinary shares in Leed at a subscription price of 0.15 pence per share.

The company will have the right to participate in further fundraising rounds undertaken by Manas up to an agreed threshold amount and the right to appoint a director to the board of Manas.

In the event that Manas gets an offer to buy its legal and beneficial interests, whether by way of a stock exchange listing, a trade sale or otherwise, Leed will have a right of first refusal to buy Manas, its business or assets at a price not less than the highest price offered by any third party purchaser, Leed said.

Manas will apply the proceeds of the loan from Leed for the purposes of the transfer to Manas of a licence for geological exploration of coal at Eastern Kokkia area of Toguz-Toro district, Jalal-Abad region, Kyrgyz Republic and for the purposes of commissioning a scoping report on thereon.

Leed Petroleum chairman Peter Redmond said the investment in Manas represents an opportunity to buy into a prospectively high value coal project at an attractive valuation.