On the Tony Buckingham blog this week I discuss the latest oil discovery off the coast of Tunisia and the corresponding boost in shares for Circle Oil.
Heritage Oil and Lucrative Oil Discoveries
As former CEO of Heritage Oil – an oil and gas exploration firm, I am familiar with entering untapped markets and discovering new reserves. In a previous blog post this week, I discussed the benefits of an oil discovery for a countries economy; in this post I will discuss the benefits for an oil company’s shares.
For Circle Oil, this discovery will benefit not just their shares but their portfolio, thus increasing reputation and influence. The discovery was made by the El Mediouni well (EMD-1) and encountered very good light oil shows in both the primary Lower Birsa target and the secondary Upper Ketatna target.
Circle commented on the discovery saying that the stratigraphy was exact to their estimations and believe there that around 100 million barrels of recoverable oil available.
Circle Remain Committed
Circle chief executive Chris Green said “we are extremely pleased to add this potential large discovery to our portfolio in Tunisia.” EMD-1 is currently suspended due to technical issues, but Green went on to say that Circle remained fully committed to taking their appraisal effort forward.
As well as this discovery having benefits for Circle Oil, many experts believe that it will have benefits for the region. Investec analyst Brian Gallagher commented on the potential of the discovery: “A discovery of this size would potentially attract new partners to the basin and de-risks the five existing prospects already mapped on the block.”
Oil and Gas Reserves Still as Valuable as Ever
I have been in the oil industry for many years, Tony Buckingham readers, and if there is one thing that keeps me motivated it is seeing other oil discoveries occurring around the world. The competitive and lucrative nature of the oil industry never ceases to amaze me.
Similarly with Circle Oil, Heritage has a place on the stock exchange, so I myself understand the importance of oil discoveries on stocks.
Tony Buckingham 