Oil Round-Up: Falklands Oil & Gas, Coastal Energy, SOCO, Cairn Energy
It was a busy day for London's listed oil companies, with new wells, well results, and asset disposals at the top of agenda.
Falklands spuds Scotia
Falklands Oil & Gas (ISE: FOGL.L) recently completed an offshore well drilling its Loligo prospect, and now its attention has turned to its next target -- Scotia.
This well is located 315 kilometers east of Stanley, has a planned total depth of 5,000 meters, and is expected to take 75 days. Falklands Oil & Gas currently has a 75% interest, and is the operator of the well. However, Noble Energy (NYS: NBL) will take 35%, reducing Falkands Oil & Gas' stake to 40%, once a recent farm-out agreement has been ratified by the Falklands Islands Government.
Coastal reports Songkhla results
Coastal Energy (ISE: CEO.L) updated its investors today on the initial flow rate from the Songkhla A-10 well in offshore Thailand. The well is initially flowing at approximately 4,000 barrels of oil per day, or bopd. The next well in the area, A-13, has been spudded and will test the northeastern fault block at Songkhla A.
Randy Bartley, president and chief executive officer of Coastal Energy, commented:
We are pleased with the initial flow rate from the A-10 well. We expect some additional gains in production as the well continues to clean up. Current offshore production is 23,000 bopd with total company production at 25,500 boepd.
The A-13 well is an exploration well testing a step-out prospect across the fault line in the northeastern area of Songkhla A. If successful, it will add additional reserves and open up a new area for further appraisal and development.
SOCO to sell Angolan stake
SOCO International (ISE: SIA.L) has entered into a conditional agreement with Quill Trading Corporation to sell its 80% majority interest in SOCO Cabinda Limited, which holds its operations in Angola. Quill already own the other 20%.
Quill has paid a non-refundable deposit for the option to acquire, within 120 days, SOCO's entire shareholding in SOCO Cabinda. SOCO Cabinda had gross assets of $32.5 million as of June 30, 2012, but no figures were disclosed in relation to the amount of the deal.
Ed Story, president and CEO of SOCO, said: "This proposed Disposal is consistent with our strategy of refocusing the asset portfolio on projects where SOCO has larger equity interests and adding new ventures, which can potentially create more value for shareholders."
Cairn reduces its holding in Cairn India, raises $910 million
A somewhat larger disposal has taken place at Cairn Energy (ISE: CNE.L) . It has reached an agreement with Citi to complete an on-market sale of a total of 152.6 million shares in Cairn India.
Cash proceeds from the sale are expected to be approximately $910 million (after transaction costs), and it reduces Cairn's shareholding in Cairn India from around 18% to 10%.
Simon Thomson, chief executive of Cairn Energy, said:
Cairn is delighted to have realized further value from its Rajasthan discoveries in India. In line with our stated strategy these proceeds will be used to deliver exploration led growth and fund the development of discovered resources in the U.K. and Norwegian North Sea. We are now extremely well positioned both financially and operationally to deliver on our existing high quality portfolio of development and exploration projects.
New World reveals increased loss
Finally, tiddler New World Oil & Gas (ISE: NEW.L) , which joined AIM last May, revealed an increased half-time loss of £1.4 million and cash in the bank of £13 million.
Bill Kelleher, chairman of New World said:
The remainder of 2012 is going to be a tremendously exciting time for New World, as we commence the drilling of our first well as operator in Belize. By mid-November 2012 we will know whether or not we have made an oil discovery, and I look forward to updating shareholders on every step of our drilling process.
In Denmark we expect to drill up to two Triassic wells in Jutland within the next 12 months, and potentially commence drilling of the Als prospect in the Baltic Region. Although these goals seem ambitious, our rapid progress to date and the presence of one of the strongest oil and gas teams around increases my confidence in our success.
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The article Oil Round-Up: Falklands Oil & Gas, Coastal Energy, SOCO, Cairn Energy originally appeared on Fool.com.Stuart Watson doesn't own any of the shares mentioned in this article.The Motley Fool has adisclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
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