Fox Davies Capital Update featuring Rockhopper, Gulf Keystone, Sterline Energy, Providence Resources, Medusa Mining and Goldstone Resources

Friday, May 07 2010 by
1

Oil & Gas Corporate News

Rockhopper Exploration (LON:RKH) (HOLD, £1.10) (RKH, 93.5p, ? (152.7%)) announced that well 14/10-2 on the Sea Lion prospect has reached a depth of 2,744 metres. Initial data collected indicate that this well is an oil discovery, which would be the first in the North Falkland Basin. The Company has run a suite of wireline logs and logging data collected thus far indicate that the well has encountered a 150m gross interval of sand and shales. The data show that the well has 53m of net pay distributed in multiple pay zones, the thickest of which has a net pay of 25m. These pay zones have an average porosity of 19%. Rockhopper now intends to collect additional logging information prior to making a decision whether to plug and abandon the well, or to suspend the well for future testing. The Company is also considering whether to drill an appraisal well on Sea Lion later during the current drilling campaign. Further information will be distributed in due course. It remains the intention of the Company to drill the Ernest prospect in the fourth slot of the overall Falklands Drilling programme.

Comment: There is oil in the North Falkland basin and Rockhopper found it. The preliminary results are highly encouraging with a net pay greater than that used for P50 pre-drill estimates and porosity of 19%, slightly lower than that used pre-drill. This is an excellent result for the Company with a commensurate reaction of the share price, now back to where we initiated and closer to our target price of 110p. Hence we reiterate our Hold rating, pending further developments.

Gulf Keystone Petroleum (LON:GKP) (BUY, £2.00) (GKP, 82.5p, ? (13.01%)) Middle East Online reported the Iraqi oil minister Hussein al-Shahristani saying that the Baghdad-Kurdistan oil row had ended with the Iraqi government agreeing to be responsible for paying extraction expenses in Kurdistan. All revenues would be handed over to SOMO, the Iraq's State Oil Marketing Organisation which deals with sales of crude and other petroleum-based products, and the Iraqi government will be responsible for paying the extraction expenses in Kurdistan.

Iraqi Kurdistan halted oil exports in October last year due to a payment dispute with Baghdad. The two sides previously clashed over how oil revenues should be distributed and Kurdish authorities had said they would not resume crude…

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Rockhopper Exploration plc is an oil and gas exploration and production company. The Company is engaged in the exploration and exploitation of its oil and gas acreage. The Company operates through three segments, which include the oil and gas exploration activities in the geographical regions of the Falkland Islands, and the Greater Mediterranean region, as well as its corporate activities centered in the United Kingdom. The Company holds interests in North Falkland Basin and the Greater Mediterranean region. The Company's areas of operations include Falkland Islands, which is located in the South Atlantic Ocean, over 8,000 miles from the United Kingdom and approximately 300 miles from South America. Its licenses in Falkland Islands include Sea Lion phase 1 (PL032), Sea Lion phase 2 (PL032/PL004) and Phase 3-Isobel-Elaine (PL004). The Company's interests in Mediterranean region include Guendalina, Ombrina Mare and Monte Grosso in Italy; Area 3 in Malta, and Block 9 in Croatia. more »

LSE Price
20.35p
Change
1.2%
Mkt Cap (£m)
92.0
P/E (fwd)
n/a
Yield (fwd)
n/a

Gulf Keystone Petroleum Limited (Gulf Keystone) is a holding company, which is engaged in the oil and gas exploration and production. The Company operates in the Kurdistan Region of Iraq. It operates through segments, including Kurdistan Region of Iraq and United Kingdom. The Kurdistan Region of Iraq segment consists of the Shaikan, Ber Bahr blocks and the Erbil office, which provides support to the operations in Kurdistan. The United Kingdom segment provides geological, geophysical, engineering and corporate services to the Company. It operates in the Shaikan oil field. The Shaikan block is situated over 85 kilometers northwest of Erbil, covering an area of over 280 square kilometers. more »

LSE Price
239p
Change
2.8%
Mkt Cap (£m)
518.7
P/E (fwd)
8.2
Yield (fwd)
4.5

Providence Resources P.l.c. is an upstream oil and gas company. The Company has a portfolio of appraisal and exploration assets located offshore the island of Ireland. The Company operates through two segments: UK exploration assets, which includes oil and gas exploration assets in the United Kingdom, and Republic of Ireland exploration assets, which include oil and gas exploration assets in the Republic of Ireland. The Company holds working interest in SEL 1/11, which contains the Barryroe oil field. The SEL 1/11 is located in the North Celtic Sea Basin, offshore southern Ireland. The Company's subsidiaries include Providence Resources UK Limited, Providence Resources (NI) Limited, Providence Resources (International) Limited, P.R. UK Holdings Limited, Providence Resources (Holdings USA) LLC, Providence Resources (Gulf) Limited, Exola Limited and Eirgas Limited. more »

LSE Price
5.75p
Change
 
Mkt Cap (£m)
33.2
P/E (fwd)
n/a
Yield (fwd)
n/a



  Is LON:RKH fundamentally strong or weak? Find out More »


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About Fox Davies Capital

Fox Davies Capital

Fox-Davies Capital Limited (FDC) has been advising and raising funds for the natural resource sector since February 2001. The firm specialises in assisting international resource companies to gain access to the UK, European and North American capital markets and has a substantial background in emerging markets particularly in Africa, Asia, Russia and the CIS.  FDC enjoys a successful track record in advising and undertaking fundraising transactions for its clients ranging from private equity to IPO and secondary offerings and works with over 350 specialised institutional resource and emerging markets funds worldwide.  FDC is authorised and regulated by the Financial Services Authority (FSA) and is a member firm of the London Stock Exchange (LSE). more »



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