Gulf Keystone (LON:GKP) investors were in for a shock this morning after a third party assessment of its reserves and resources in the Kurdistan region of Iraq.
The competent person’s report (CPR), prepared by ERC Equipoise, is a key component in the planned move up onto the LSE’s official list from AIM.
It confirms just under 300mln barrels of proved and probable (2P) reserves, as well as about 920mln barrels of contingent (2C) resources. All of the reserves and the bulk of the contingent resources are identified in the Shaikan and Sheik Adi fields.
A total of 12.5bn barrels of gross oil in place were confirmed in the CPR, which is well shy of prior estimates in the order of 19bn barrels. Indeed, previous estimates put Shaikan’s oil in place alone between 12.4bn and 15bn barrels.
Gulf Keystone described the new CPR as “conservative” and chief executive Todd Kozel said the third party assessment provides a “baseline” that the group’s future progress can be measured against.
“This report represents a conservative estimate based solely on reserves which are being targeted with 26 wells representing less than 25% of all wells currently envisaged for the Shaikan development,” Kozel said in a statement.
“The CPR does not take into account undrilled and untested horizons and we see a clear route for unlocking the upside to these 2P and 2C numbers through drilling more wells and thus obtaining a better understanding of the oil water contact levels and the actual fracture porosity.”
Trigger-happy investors however were not convinced and sent the shares down 17% to 119p, giving the company a stock market valuation just north of £1bn.
The slightly smaller Hummingbird Resources (LON:HUM) today confirmed the receipt of the US$5mln final chunk of a US$15mln financing agreement with Anglo Pacific.
The gold explorer said the payment takes its cash balance to US$10mln and fully funds it up to and beyond the completion of the Detailed Feasibility Study for its flagship Dugbe 1 project in Liberia, which is expected in the third quarter of this year.
It follows a meaty upgrade to the resource estimate at the Tuzon deposit of Dugbe 1 yesterday, which sent the share price up as much as 20% at one point.
Savannah Resources (LON:SAV) has been growing its market capitalisation markedly since the New Year.
The shares are up more than 100% in 2014 and picked up again today as the company moved higher after testwork confirmed the Jangamo tenement in Mozambique plays host to “a major heavy minerals system”.
The results returned heavy minerals including ilmenite, rutile/leucoxene and zircon over some very broad intersections in two major zones, the company said.
It has now commissioned consultant TZ Minerals International to outline a path for the project through to a scoping study.
The results are from follow-up analysis on samples collected from the initial scout drilling programme.
The curtain could soon fall on the lengthy court battle between Leni Gas & Oil (LON:LGO) and Mediterranean Oil & Gas (LON:MOG).
The court case has finished, but a judgement has yet to be handed down, MOG confirmed on Thursday.
LGO took MOG to court after it sold it a 10% interest in an oil exploration block offshore Malta for just $1, only to see that interest farmed out to Genel Energy (LON:GENL) just 23 days later for $10mln in cash.
The David Lenigas-chaired company claimed it would not have sold its stake for a nominal sum had it been aware of interest from potential farm-in partners.
Elsewhere, Jupiter Energy (LON:JPRL) told investors it continues to see “measured progress” in Kazakhstan in its six-month review, while Milestone Group (LON:MSG) appointed Frank Sweeney as programme director for the Passion Project, its youth engagement programme.