Drilling six out of six dud wells in 2012 hasn't dissuaded Faroe Petroleum (FPM) from committing to another busy exploration and appraisal drilling programme in 2013. The fully-funded UK North Sea and Norway-focused explorer has five firm wells planned for this year, four of which are located offshore of Norway and benefit from huge exploration tax rebates.
Faroe has already drilled one well this year, Rodriguez, in Norway, which resulted in a significant gas condensate discovery - providing hope that this year will prove more fruitful with the drill bit. Faroe also spud the Darwin exploration well offshore of Norway in early March, targeting a huge 400m barrel oil prospect. It holds a 12.5 per cent interest in the licence.
Production from non-operated interests in Norway and the UK North Sea should yield between 7,000 and 9,000 barrels of oil-equivalent (boepd) in 2013, up from 6,900 boepd in 2012 and 2,500 boepd in 2011. Along with a hefty cash pile and debt facilities totalling $425m (£280m), Faroe should be fully funded to spend £170m on exploration and development in 2013, up slightly on the £161m spent in 2012.
FAROE PETROLEUM (FPM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 147p | MARKET VALUE: | £312m | |
| TOUCH: | 146-147p | 12-MONTH HIGH: | 179p | LOW: 123p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 109p* | NET CASH: | £72.9m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 2.30 | -28.8 | -19.7 | nil |
| 2009 | 7.00 | -11.8 | -6.60 | nil |
| 2010 | 15.1 | -26.0 | -13.3 | nil |
| 2011 | 80.2 | 14.3 | 22.3 | nil |
| 2012 | 159 | -29.0 | -2.44 | nil |
| % change | +98 | - | - | - |
*Includes intangible assets of £145m, or 68p a share | ||||
