By Garry White, Questor Editor 700AM GMT twenty-three March 2010
Salamander Energy
Salamander Energy
257p -6
Questor share tip BHP Billiton is a buy as short-term iron ore pricing nears Talk that BHP Billiton is eyeing US-listed Mosaic Ventures destiny is splendid but a bid Cape shares are up 143pc, but still see undervalued Rio Tinto slides among speak of �5bn income call Buoyant banks assistance marketplace finish losing runQuestor says BUY
The association is training twelve wells this year, targeting resources of 340m barrels of oil equivalent. The primary big headlines on the training programme should come towards the finish of Apr from the well at Bang Nouan in Laos. Drilling work was proposed or "spudded" on Feb twenty-two and is approaching to take up to 75 days. Salamander has a 30pc operative seductiveness in this plan and it could enclose recoverable pot of up to 1.1 trillion cubic feet of gas.
Two serve wells are approaching to be drilled in the second quarter, 3 in the third entertain with the rest in the fourth entertain of 2010. Success at any of these sites would open up most serve training prospects that could be drilled in the future.
The shares changed reduce last week after the organisation denounced a $100m (�66.3m) automobile down payment issue to one side the full-year numbers. The automobile issue was not to lift supports for the 2010 training programme, that is full funded. The income lifted is a fight chest to buy some-more resources in Middle East should the event arise. The association believes that there has been a change in the item marketplace as the oil cost seems to be stabilising and thinks that this is expected to move out some-more sellers in the region. "We haven"t seen the item marketplace in Middle East this colourful given the begin of the downturn," pronounced James Menzies, arch executive.
Salamander voiced the primary squeeze to one side the automobile announcement. It has paid for the operatorship and a 50pc seductiveness in a retard offshore Northern Vietnam in the Hanoi Trough from Santos and Singapore Petroleum. This is a new dish entrance for Salamander and the area is in the primary stages of exploration. However, item purchases crop up to be a medium-term goal, so investors should not design to see a raft of purchases in the subsequent couple of months.
In the 12-month duration to Dec 31, revenues rose 56pc to $157.1m and pre-tax waste narrowed to only $3m from $75m in the prior year. Production in 2009 averaged 13,600 barrels of oil homogeneous a day, a 41pc year-on-year rise. Salamander expects prolongation in the stream year to climb by in between 17pc and 18pc. The association had $59.2m in income at the finish of 2009 and net debt of $115.4m.
The shares are trade on a Dec 2010 gain mixed of 17.6 times, in expectation of their training programme. The shares changed roughly 6pc reduce after the automobile headlines last week and are right away 13pc next the primary letter of reference cost compared with a marketplace up 2pc. Salamander stays a speculative, high-risk fool around formed on the high-impact training programme over the march of this year. Being high risk, investors should not deposit a poignant volume of income in the shares.
