re: what happens if a duster...
Compare Baraka with the likes of Global Petroleum (GBP). They have 20% in two blocks in Kenya with Woodside and 14% in the Falklands with Hardman. They've got two wells coming up in Kenya, but the Falklands is probably at least 3 years away. Yet they're capitalised at $135m.
Baraka are capitalised at only $70m and have a list of assets a mile long in comparison.
35% in Block 20 Mauritania with CNPC, 25% in two blocks with Woodside in Mauritania, and I would expect them to hold around 30-35% for the five large Mali blocks with two super-majors. One well drilling now and five more before the first quarter of 2009 in Mali. Over $20m in the bank after the Mali farm-out and the possibility of at least one acquisition of a producing assets before the year is out.
Baraka is due for a re-rating even without exploration success at Heron. There's no doubt that the shareprice will dip on a failure at Heron, but it would be a quick recovery. And success sees them over $1 now and over $3 within 2 years when they expect to have first oil.
There's actually also a shallower gas target which they'll hit before the primary target at Heron. They're hoping in a worst case scenario to utilise this for power supply to Mauritania. Not sure if they're planning to comment on hydrocarbon shows for this target until the end of the drill though. Might get the shareprice going if they did.
Cheers, Butcherano.
BKP Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
