Seymour Pierce has taken the gloss off Borders & Southern today, knocking it back 4% or so to 24p. The broker says that the 130-250 million barrels of condensate (probably 190 million barrels) at the Darwin discovery is unlikely to be commercial as a standalone discovery. Falkland Oil and gas was also down over 4% to 91.75p on rumours of drilling delays caused by bad weather in the South Falklands basin – all unsubstantiated.
Seymour Pierce analyst Sam Wahab says on BOR “In our view, whilst the size of the prospect is relatively small given the remoteness of its location and cost of developing the necessary infrastructure, it is unlikely that the Darwin field will be a standalone discovery,” “On this basis, Borders’ 2013 seismic survey (which will focus on prospects currently outside the existing Darwin 3D area) could prove critical in the company’s long term operations in the Falklands.”
If the rumours are true of delays in the Loligo drill then unfortunately investors in BOR and FOGL will still have quite a wait to see if the South Falklands basin is the oil man’s dream or not!
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