Petrel shares drop 7.6% over fears of delay in developing Iraqi oil fields

SHARES in Irish exploration firm Petrel Resources lost 7.6% of their value yesterday after it warned that its plan to develop three oil fields in Iraq may be delayed.

The company told shareholders at its annual general meeting that some political developments have presented some challenges to the company’s plans, but have not derailed the projects.

“The new (oil) minister has reasserted the need for professional and pragmatic progress. We have received excellent co-operation and a warm welcome from Iraqi officials,” managing director David Horgan said.

Petrel has submitted tenders to develop the Khurmala Dome, Hamrin and Subba and Luhais oil field developments in Iraq.

It said the some issues are political in nature but other are technical and infrastructure issues.

“Petrel is now in detailed technical discussions with the Iraqi Ministry of Oil on the first two of three tenders submitted recently. The work deepens and broadens the detail provided in our submissions in response to the tender information made available to pre-qualified companies, including Petrel.” Shares in Petrel, which are listed on London’s Alternative Investment Market, fell 3.5p top 44p.

Mr Horgan said given the economics and geology of Iraqi oil, Petrel believes that funding should not be a problem. Last year it raised about £1m to fund the exploration of the Iraqi field.

Petrel was also helping Iraqi economy by employing local workers. “They are honest, brave and reliable. Where exceptional problems arise, as where we cross different tribal areas/political spheres of influence, we may have to employ international security operatives.”