Investors Chronicle - Afren hits light crude

The share price of Afren was buoyed by news of an oil discovery in the Kurdistan region of northern Iraq, which chief executive Osman Shahenshah believes has "the potential to be transformational". Afren has a 20 per cent stake in the Simrit-2 discovery well as part of the Ain Sifni product sharing contract. Drill tests to 3,700 metres encountered an estimated 409 metre hydrocarbon interval, including 312 metres of what is believed to be light oil. Afren and operator Hunt Oil Middle East plan to continue drilling to test additional zones.

SHARE TIP UPDATE:

Afren's share price - at 144p – is up by 260 per cent on our original buy advice (40p, 14 Nov 2008), but recent drilling at Simrit-2 could conceivably result in an upward revision to resources. FirstEnergy Capital value Afren's total exploration suite at 21p risked and 223p unrisked per share. Another 40p risked element could be added through imminent drilling at Afren's PaiPai and Nunya-1X prospects. Buy.

Last IC view: Buy, 135p, 28 March 2012

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Afren hits light crude

SHARE TIP UPDATE:

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