Argos Resources sees institutional stake building

Argos Resources, the AIM listed, North Falkland basin oil and gas exploration company owns a 100 per cent interest in production licence PL001 covering an area of approximately 1,126 square km. It rose 6% yesterday to 23.5p and announced today that JP Morgan now have a stake of over 7% and Canadian Hedge fund Salida Capital has acquired a 3.3% stake.

The licence area adjoins licences PL032 and PL004b, the former being the site of Rockhopper’s Sea Lion oil discovery and the latter where the Casper, Casper South and Beverley discoveries were made.

A 3D seismic survey completed in 2011, identified 28 prospects with a total unrisked potential of 2.1 billion barrels of prospective recoverable resource in the most likely case and up to 7.3 billion barrels in the upside case.

The company has been hit by a lack of resources to find a drilling rig as well as rig availability. With the 3D seismics in hand, Argos has been trying to find a farm in partner after Rockhoppers’s Premier Oil deal and Falkland Oil and Gas’ Agreement with Edison. The stake building by JP Morgan may be a sign that the company is close to announcing something.

One to keep an eye on given its proximity to Rockhopper’s acreage in the North Falkland basin, though don’t expect drilling anytime soon.

Contrarian investor UK