Carnarvon Petroleum Limited (ASX:CVN) expects to start drilling the Phoenix South-3 well on Western Australia's North West Shelf around April 10.
The GSF Development Driller-1 semi-submersible drilling rig is expected to arrive at the site around April 5 after some slight delays.
Transfer of the rig to the site was impeded by cyclone Marcus passing the tow path.
The rig is now in the final stage of its journey from Mauritius to Australia.
A small hitch in a big year
This represents only a minor delay and with multiple share price catalysts at play throughout 2018, many analysts see Carnarvon as undervalued.
READ: Carnarvon Petroleum enters 2018 with multiple share price catalysts including the prospect of a takeover
The objective of the Phoenix South-3 well is to assess gas and condensate discovered at the top of the Caley interval in the 2017 Phoenix South-2 well.
It will be located only 560 metres from the Phoenix South-2 well and has been constructed to specifically allow for evaluation of this interval.
Carnarvon is targeting an estimated gross mean recoverable prospective resource of 489 million standard cubic feet of gas and 57 million barrels of gas condensate.
Brokers unperturbed by delay
Aiden Bradley from Hartleys Research just reassessed the company, taking into account the delay.
He maintained his speculative buy recommendation and price target of 25 cents, reiterating that the company was one of his top picks in the sector for 2018.
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Bradley said: “Our rating is based on a combination of an attractive valuation (low enterprise value/barrels of oil equivalent), newsflow, oil price leverage and takeover appeal.”
Bradley’s price target implies upside of nearly 100% to Carnarvon’s closing price of 13 cents on Wednesday.