Hi Tricom have just released an updated Analysis Report about...

Hi


Tricom have just released an updated Analysis Report about Incremental.



Highlights are:



TRICOM RESEARCH: Incremental Petroleum Limited (IPM $1.065) – Selmo production up 10% in July

Reiterating BUY recommendation with a $1.72/share price target

IPM’s core cash flow generating asset is its 100% owned Selmo Oil field in south-eastern Turkey.
The project has 11.3mmbbls in 2P reserves and is currently producing around 450,000bbls per year.
Selmo is expected to generate in excess of $20Mpa in cash flow over the next three years which will enable IPM to undertake its planned development programs in Turkey and California and also continue to pay unfranked dividends.
Development drilling at Edirne was completed as planned with five wells testing at a combined rate of 12.2mmcf/d.
IPM is now negotiating offtake agreements for the gas with the aim of commencing production in mid 2009.
IPM has a 55% interest in the project and is the operator.
Based on an initial production rate of 9.0mmcf/d, Edirne should generate around $10Mpa of cash flow for IPM. Capital costs for Edirne are estimated at US$10-14M.
We are reiterating our BUY recommendation on IPM but have lowered our price target from $1.85/share to $1.72/share to reflect some modest downgrades to our oil price assumptions.
Solid production from Selmo should underpin IPM’s share price while further development news at Edirne and the newly acquired US projects provide significant upside potential for the stock.







Regards





Jonathan Asquith

Company Secretary/CFO

Incremental Petroleum Limited

Tel: +61 8 9481 8696

Fax: +61 8 9481 2394

Mob: 0438 885 055