This should get thing's going for Sodra..
London 25 May
Swedes set to increase oil fever on AIM
THE FALKLAND ISLANDS are to provide a second oil exploration stock for the Alternative Investment Market, adding to the oil
fever caused by the recent drilling report from Amerada Hess and Desire Petroleum. Lundin, the Swedish energy group, intends to spin
off Sodra Petroleum, which hopes to mirror the success of Desire, whose shares surged 138 per cent last week as investors speculated
that it may strike some of the œ15 billion worth of oil thought to lie around the islands. Sodra's only asset is a 50 per cent stake in one
of the seven tranches of exploration acreage licensed by the Falklands Government. City analysts estimate that the area could contain
2.2 billion barrels of oil, worth œ2.6 billion. Sodra's acreage adjoins the block allocated to Lasmo - in which Desire has a 25 per cent
stake. Clyde Petroleum, the North Sea company bought by Gulf Canada last year, also has a 12.5 per cent stake in this Lasmo slot.
City reports estimate that Sodra's slot has the potential for œ2.6 billion worth of oil - œ1.3 billion of which would be attributable to its
shareholders. If Lasmo strikes the œ3.2 billion of oil that City analysts say could be lying under its slot, Desire would be in for œ400
million. Sodra needs to raise money to cover drilling costs - which some industry sources put at œ20 million. Sodra is one of 15
companies to have chipped in to hire Borgny Dolphin, a semi-submersible drill towed in from the North Sea, at a cost of œ70,000 a
day. Amerada Hess, the US oil company, is currently using the drill and last week reported early signs of hydrocarbons - which
prompted the dramatic rise in Desire's shares. The drill begins work on one of Lasmo's two blocks next month. After moving to Shell's
block in August, it is due to do the initial drilling in Sodra's block - tranche F - in October. Although Desire has 100 per cent of the two
tranches nearest the islands, Borgny Dolphin is not booked for either.
Desire;
Lehman Brothers has pointed out to their customer's that there have been some "technical errors" in the newspapers concerning Desire.
One of the errors you may have noted is taken up on my page ie the newspapers have said that Desire is drilling now, which ofcourse is wrong.
Sodra has everything to gain from this equation
Later mate,
Greywolf |
