March 30, 2010 (FinancialWire) — Bontan Corp. Inc. (OTCBB: BNTNF) said that, along with its indirect majority-owned subsidiary, Israel Petroleum Co., Ltd., the company has entered into an agreement with Tel Aviv-based Emanuelle Energy Ltd. and IDB-DT Energy Ltd. for around $16.1 million of new financing to assist in further developing a natural gas exploration project offshore from Tel Aviv, Israel.

According to Bontan, the agreement also settles the litigations amongst IPC, PetroMed Corp., Bontan and their respective affiliates relating to ownership of the 95.5% interest in the "Sarah" and "Myra" drilling licenses, and the now expired "Benjamin" drilling permit, acquired by IPC from PetroMed in November 2009.

PetroMed's share in the licenses is currently listed in PetroMed's name on the registry maintained by the Israel Ministry of National Infrastructures. Conditioned on the MNI's transfer approval, IPC, Emanuelle and IDB-DT will receive respective working interests on the registry of 14.325%, 54.025% and 27.15% in the PetroMed's share of the licenses and the permit.

Bontan's working interest in PetroMed's share of the licenses and permit is 11% held through its holding of 76.8 % equity interest in IPC.

As part of their working interest acquisition, Emanuelle and IDB-DT agreed to contribute around $16.1 million of which around $10.5 million will be paid to WesternGeco, a geophysical services firm and a subsidiary of Schlumberger, for joint title with IPC for the delivery of 2-dimensional data, and for processing an estimated 11 weeks of 3-dimensional geophysical mapping data on the license sites.

PetroMed agreed to the cancellation of the 8.6 million shares of Bontan common stock, and the 22.8 million Bontan common stock warrants, issued to it as part of the consideration for the transfer of PetroMed's Share in the licenses and permit to IPC in November 2009. PetroMed said it will retain the $1 million cash payment made by IPC.

Canada-based Bontan Inc. is an oil and gas exploration company that operates and invests in exploration prospects. Bontan will have 60,284,076 common shares issued and outstanding after cancellation of Petromed shares as above.

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