Oil Round-Up: Petrel Resources, Serica Energy, and Faroe Petroleum

Petrel Resources  (LSE: PET.L  ) heads our oil round-up this morning, with the shares bouncing up 22% to 5.38 pence after giving an update of its progress in Iraq.

The statement itself was, in fact, rather brief and somewhat lacking in detail. Petrel said:

In mid 2012, Petrel appointed a new Baghdad/Amman based team of Iraqi citizens to review the standing of and opportunities for Petrel in Iraq. The first objective was to clarify the position of Petrel with the national authorities in relation to existing and historic projects in which Petrel has or had an interest. This is done.

The second objective is to work with national and regional authorities in Iraq to identify projects in which Petrel can be involved. This work is ongoing.

Nevertheless, given the share price pop, it seems to have pleased some shareholders. The shares have steadily declined for a long time now, having peaked at 150 pence some five years ago.

Serica sources a farm-in
Serica Energy
  (LSE: SQZ.L  ) has reached an agreement with JX Nippon Exploration and Production regarding a 85% interest in Central North Sea Block 22/19c. Serica will retain a 15% interest. JX Nippon will pay to Serica US$250,000 and carry Serica's share of all future costs associated with the license up to and including, at JX Nippon's discretion, the drilling of an exploration well.

Serica had previously partnered with Premier Oil  (LSE: PMO.L  ) on the same block, but they have since relinquished their interest. However, the new deal with JX Nippon will target deeper formations. Serica shares edged 2% higher to 30 pence.

Leni losses increase
Leni Gas and Oil
  (LSE: LGO.L  ) dipped 9% after reporting an increased loss of £1 million. The company is reshuffling its portfolio of assets at the moment, and is also embroiled in a legal dispute with Mediterranean Oil & Gas  (LSE: MOG.L  ) over a stake in a prospect in Malta, which was effectively sold on for a much higher sum just weeks after Mediterranean purchased it from Leni.

Faroe moves into the black
North Sea specialist Faroe Petroleum  (LSE: FPM.L  ) reported a profit of £4 million after a sharp increase in production levels to 8,581 barrels of oil per day over the last six months.

The company said its net cash was £103 million at the period end and that its exploration program was fully funded, partly helped by Norwegian tax rebates. Faroe shares were little changed at 154.5 pence.

Kentz's new contract
Finally, Kentz Corporation  (LSE: KENZ.L  ) , the engineering group focused on the resources sector, revealed it had won a $50 million contract with Exxon Neftegas to shut down a well in Far East Russia. The shutdown will take place next July and involve a peak workforce of 600 people.

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Stuart Watson does not own any share mentioned in this article. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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