up 26% in london but plenty more upside?, page-8

Its taking a long time for the market to wake up to the potential of this offshore Namibia/ Mozambique deal.

Offshore Namibia may be familiar to PIs because of GBP's relation whip with Tower and their interest in Offshore Namibia. Offshore Mozambique may be a little less familiar. To get an insight into this take a look at COV.L's rise and rise. They have a relatively small percentage interest in Anadarkos Offshore Mozambique drilling campaign, which has been ongoing for about 16 months. To date they have had a number of massive gas discoveries but no oil. This could change in the next few days!!. Anadarko look like they will not only be staying in this area for the next year or two, they are considering increasing the number of drill ships from one to two. As their success continues, companies with nearby leases will become of increasing interest to other majors. I suspect that the directors of GBP have already had discussions in this respect and that is why they decided to fold their private, leases owning, company into GBP.

Another thing to keep in mind here is that the oil producing countries of the Middle East are heading into a period of increasing political instability, placing increasing pressure on their ability to supply the West with their oil and that Namibia and Mozambique are unlikely to suffer a similar fate, at least for now. This makes these new emerging regions very attractive, even as a source of gas.

Given the lack of PI interest on this BB and the relatively large trades that went through today, suggest that todays action was by an Fund (or two) taking a risky high potential position, which they will hold for the next few years, years where the world could easily go to war over access to hydrocarbons. Sorry, not trying to be alarmist, just scanning the horizon .....

K