Dana Petroleum, earning per share growth and prospective PE range 4 -6.5

It's got the thumb's up from Tom - better sell now then!

Dana - Drilling Update
Dana (DNX) this morning announced the results of its first well in Mauritania. The statement reads:

"Dana Petroleum is pleased to announce that the Pelican-1 exploration well, drilled in Block 7 offshore Mauritania, has discovered significant hydrocarbons within its primary, Tertiary age target horizon. The well was drilled to a total depth (TD) of 3,825 metres (11,659 feet) with oil and gas shows encountered while drilling from approximately 3,400 metres to TD. Subsequent wireline logging has indicated a gross hydrocarbon column spanning over 300 metres, within which a number of good quality reservoir sands have been developed. Preliminary analysis of log and pressure data indicates the hydrocarbon type within the sands at this crestal location on the structure to be gas. It is too early to conclude whether Pelican-1 has discovered an independent gas field or a gas-cap overlying an oil field. Preparations are underway to suspend the well to enable re-entry for future use as appropriate."

Given that Block 7 in Mauritania is 69 times the size of a North Sea block, to encounter such a decent gas show with your first well is pretty good going or, at worst, pretty fortuitous. The strike seems to indicate that there are commercial quantities of hydrocarbons in the block which is extremely encouraging although clearly there is a lot of work that remains to be done. At 239.5p our stance remains "buy."

WSLS