Global Petroleum Share News (GBP)

The news that Chariot Oil and Gas's Kabeljou exploration well was plugged and abandoned as a dry hole prompted most brokers on Monday to either downgrade or put their ratings for the stock under review and significantly reduce their target prices.The Africa-focused oil and gas firm said that the well in Southern Block 2714A in the Orange basin offshore Namibia reached a total depth of 3,150m but no commercial hydrocarbons were found.Investec cut its recommendation for the shares from 'buy' to 'hold' and slashed its target price from 318p to just 31p, saying that it "cannot ascribe any value for exploration currently." The broker said that the new target is a result of Chariot's $101m cash balance.The shares were trading around the 180-190p mark until mid-May when the company revealed that its Tapir South exploration well in the Namibe basin, offshore Namibia, also failed to find commercial hydrocarbons. While the news saw the shares drop to the 80p level, today's revelation saw the stock tank further, down 66.16% to 33.25p by the afternoon.Investec's analysts said: "The equally disappointing at Tapir South made success at Kabeljou critical for Chariot. What is clear is that the next steps are uncertain given this well result."Seymour Pierce said that this result "concludes a disappointing year" for Chariot: "We have been long term sellers of Chariot since our February initiation, highlighting the under explored nature of their acreage and optimistic chance of success estimate prior to drilling," said analyst Sam Wahab. After today's sell-off, the broker decided to change its recommendation from 'sell' to 'reduce' and cut its target price from 58p to 31p.Northland Capital Partners said that it would place its 'add' rating under review until the shares have corrected over the next couple of days. As McGeary highlights, today's news heralds inevitable weakness for some of the region's other explorers, such as Tower Resources, Global Petroleum or Serica Energy who operating in the Namibe, Walvis and Luderitz basins, respectively. All three stocks tanked today as well."These all operate in unique geologies so we would expect any weakness to present good buying opportunities," he said.Merchant Securities downgraded its rating for the stock from 'buy' to 'sell' today and slashed its target price from 232p to 29p.Analyst Brendan Long said this new value "equates to the cash held by the company after its two exploration wells. It is possible that in the months ahead we increase our target price substantially as the company provides information on its forthcoming drilling prospects. We expect that more information on the next prospect, Delta 1, will be provided later this year."