T5 Oil & Gas sizes up targets
The company — established by five former Tullow Oil executives and headed by that company’s former chairman, Pat Plunkett — currently has a small number of assets in Senegal and had been linked with a possible listing on London’s AIM market last year.
Yesterday, it distanced itself from speculation linking it with a takeover bid for London-based explorer Afren by stating it has no such plans. However, it is understood that other struggling targets, lending themselves to the prospect of a reverse takeover and enabling T5 a cheaper route to public ownership, are actively being examined.
Afren saw a stabilisation in its share price — which had been hit by a damaging resource update from its Iraqi-based assets earlier this month — on Monday, after Mergermarket.com reported that T5 was treating the London-based, African-focused explorer as a takeover target.
In a statement, T5 — which trades as New Horizon Oil & Gas — said it had noted the article and added that it “does not intend to make an offer for Afren”.
A figure of £800m (€1.05bn) had been quoted in the speculative report.
Afren is reportedly considering strategic options for its Barda Rash field, located in the Kurdistan region of Iraq, which recently had its resource estimates lowered from 1.24m barrels of oil to just 250 million barrels. A refinancing of some existing debt this year is also being viewed as vital progress for the company’s future as a standalone entity.
Elsewhere, Dubai-based Dragon Oil — which recently withdrew takeover interest in Irish explorer Petroceltic — reported a near 7% increase in average daily production rates to around 78,790 barrels of oil per day, for 2014, with average daily production for December amounting to nearly 89,700 barrels, with an exit rate of just over 92,000 barrels.
The company — whose shars are partially listed in Dublin — said it continues to seek acquisition opportunities and will “continue to search for the right fit value-creative development asset”.
Dragon aims to average gross production of 100,000 barrels of oil per day next year and maintain that level for five years. Its current forecast for capital expenditure for 2015 is in the range of $500m-$600m.
