From FT Alphaville blog earlier today...Earlier this week we had...

From FT Alphaville blog earlier today...

Earlier this week we had RRL management in for a meeting, although I?d have to say I wasn?t overly impressed.NH
The group has a diverse range of assets in Somalia, the US, Georgia and Trinidad. Undoubtedly the greatest excitement surrounds the Somalia licence, where the group is due to participate in two exploration wells commencing this summer
RRL has a 20% interest in the licence onshore Puntland (the northern part of Somalia), with both wells believed to have OIP of over 1bn barrels. However these are high-risk wells, operating in a highly risky environmentNH
Assuming a 40% recovery factor on a 1bn barrel OIP discovery, and ascribing $5/bbl on an NPV basis (which is arguably generous), we?d get to around 18p/share unrisked, i.e. below the current share price of 21p/share
. Even giving some credit for the other three areas I reckon we might get to around 30p/share at a push, but I?d stress that this is unrisked and assumes material success.
The shares have quadrupled since November in anticipation of the imminent Puntland drilling, but if I was a punter in this one I?d be taking profits.

http://ftalphaville.ft.com/blog/2011/03/04/505036/markets-live/