Cobalt International Energy Shares Jumped: What You Need to Know

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Cobalt International Energy (NYS: CIE) jumped as much as 22% today after the company extended a lease on an oil rig off the coast of Angola.

So what: The company said it had extended its lease with DiamondOffshore Drilling (NYS: DO) for the rig Ocean Confidence by as much as two weeks. The rig is drilling for oil that lies at least 23,000 feet beneath the ocean's surface and is hoping to strike black gold on oil fields that contain an estimated 2 billion barrels of oil. Another explorer, Maersk Oil, reportedly hit the massive oil field and is waiting for government approval to release the results.

Now what: The news from Maersk Oil hasn't been confirmed yet, but judging by the market's reaction the numbers should be fantastic. Cobalt was unsuccessful in an initial well, and the hope is that the current wells being drilled will pay off big. I'm not buying on rumor, but if Cobalt can strike a rich well in the region, it could be a game changer.

Interested in more info on Cobalt International Energy? Add it to your watchlist byclicking here.

At the time this article was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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