Bowleven (LSE:BLVN) shares were steadily rising since the opening of trading fuelled by rumours of a bid by Africa’s independent oil giant Tullow Oil, hitting 86 pence a share at 11:30 GMT.
But minutes after that, at exactly 11:40, Dragon Oil broke its silence and told the authorities it is them and not Tullow Oil that is interested in buying the Edinburgh-based oil and gas exploration company.
Within minutes, Bowleven was trading beyond 100 pence again and reached 129 pence a share at noon London time, a 73% increase in value with 31 million shares switching hands.
Dragon Oil admitted “it is in the preliminary stages of exploring a possible offer for all of the issued and to be issued share capital of Bowleven.”
The Dubai-headquartered oil and gas, whose only asset is in Turkmenistan, is interested in becoming a player in Africa, by getting Bowleven’s interests in Cameroon and Gabon.
Bowleven Assets
Bowleven’s Cameroon and Gabon interests hold a combined total of more than a billion barrels of liquid reserves and producing more than 350,000 barrels of oil a day (“bopd”).
Gas reserves in Gabon are pegged at 90 billion cubic feet (“bcf”) and currently producing 0.03 bcf a day, with crude oil trading at US$102 at WTI and US$119 in Brent.
Price Bid
Rumours circulating told of a 200 pence per share offer from Dragon Oil, which they will have to decide before 16th March.
The standard “this announcement does not constitute an announcement of a firm intention to make an offer” was stated.
Investors of Dragon Oil were not as enthusiastic as its Board as the stocks are slightly down by 9 pence, or 1.6%, to 535 pence per share, at 1:30 PM GMT.
As of press time, 46 pence were gained by Bowleven shares, 62.2% more, making the share price at 120 pence.
Company Spotlight
Bowleven is an oil and gas exploration group with assets in West Africa, onshore and offshore Cameroon and onshore Gabon.
Dragon Oil is independently engaged in upstream oil and gas exploration, development, and production activities principally in Turkmenistan.
Bowleven is listed on the Alternative Investment Market, while Dragon Oil is on the main listing of the London Stock Exchange.
References
↑ Statement on Possible Offer
↑ Bowleven jumps nearly 70% after Dragon Oil says it is considering a bid
↑ Dragon Oil Operation
↑ Bowleven Business Operation
↑ Commodities Trading