Shares in Ascent Resources rocketed this morning, after Cadogan Petroleum confirmed it made a "highly preliminary approach" regarding a possible tie-up.
Ascent shares rose around 73.7 per cent to 3.39p per share in mid-morning trading, while Cadogan added around 15.4 per cent to 11.25p.
It comes after Ascent said last week that it had received a preliminary takeover approach from Cadogan, helping its shares to more than double on the news.
"The discussions are at an early stage and there can be no certainty that an offer will be made, nor as to the terms on which any offer might be made," Ascent said in a statement at the time.
Cadogan must now announce a firm intention to make an offer, or say it doesn't intend to make an offer, by 5pm on 21 April.
However, this deadline can be extended with the consent of the UK takeover panel.
Cadogan added it couldn't provide more details at this stage due to the highly preliminary status of events. It also said further announcements would be made as soon as the need arises.