The oil and gas exploration sector has been a scene of carnage in recent weeks, with share prices plunging as oil gets cheaper and cheaper. And with Brent crude dropping to a new low of $63 per barrel, weve seen three more oilies slumping to 52-week lows:
Bowleven
Africa-focused Bowleven (LSE: BLVN) ended Thursday on a closing low of 25p, and has dropped even lower to 24.7p in morning trading today. Thats a loss of 43% since a 17 January close of 43.75p.
Bowleven is one of those at-risk explorers that is still in the net investment phase that is, its not making any profits yet. The year ended June 2014 brought in a loss of 4 cents per share, and theres a slightly smaller loss pencilled in for June 2015, so fear is understandable.
But in its full-year results announced in November, Bowleven told us that it had a cash balance of circa $14m with $30m bridge facility undrawn and available pending farm-out completion although utilisation not anticipated.
Rockhopper
Rockhopper Exploration (LSE: RKH) has been hit by the double-whammy of both oil prices and of being active in the so-far disappointing oil fields around the Falklands. Its another thats yet to turn a profit too, although the biggish losses of the past two years are expected to moderate.
Again, cash doesnt seem to be a problem at the end of its last full year in March, Rockhopper reported a cash balance of $247m.
The share price? Down 61% since Januarys high, to 59p.
Genel
Genel Energy (LSE: GENL) is unique among these three in that its actually making nice profits. The largest independent oil producer in the Kurdistan Region of Iraq (KRI), Genel turned in revenue of $192m in the first half of 2014, from which it extracted a pre-tax profit of $70.7m. The firm is still in a net cash outflow stage of operations, but in early December Genel reported an initial gross payment of $30 million from the Kurdistan Regional Government for oil exported through the KRI-Turkey pipeline. Exports by pipeline now exceed 350,000 bopd.
Genel shares have still been hammered by the oil price, and are down 43% since January to 627p. That suggests a P/E of 17 for the year to December 2014, but with production and profits set to rise strongly in 2015, it would drop to just 10.
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Alan Oscroft has no position in any shares mentioned. The Motley Fool UK has recommended Genel Energy. We Fools don’t all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.
