Came across this article in the weekend Australian financial review, in part it reads:
"Indonesian bid for Novus shows the value of assets."
"A $326 million bid for Australian based international energy company Novus petroleum has highlighted the strong valuations that oil explorers are placing on assets (compared with a share prices) of listed companies. The unsolicited offer by Medco Energi, Indonesia's largest listed oil and gas group, sent shares in Sydney based Novus surging by 40 percent. It is one of the first major corporate moves in Australia by an Indonesian company since the Asian financial crisis in the late 1990s. Woodside petroleum highlighted the potential attractions of oil company takeovers in a recent briefing for investors. Finding and developing a barrel of oil has cost between $US5 and $US16 over the past five years, based on a survey by consultants JS Herold and cited by Woodside. The average cost of acquisitions by the same group of companies range between $US4 and $US10. Benchmark US crude oil prices have recently been trading at almost $US33 a barrel, a price that is very profitable for almost all oil companies. However, that was not reflected in the valuations of oil shares, said Tim Barker, a portfolio manager at BT financial group. The sharemarket has generally not believed the high oil prices, he said. Transactions in the asset market had tended to be at the upper end of expectations."
Hmmm... if Mauritania is as big as one suspects... could be a nice cheap pickup for a major!
Cheers BBQ.
HDR Price at posting:
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