Are the Knives out or what..blimey16 Apr 2015 08:17
Gatwick gusher more of a trickle
Who would have thought it? The Gatwick gusher might not even be a trickle, much to the relief of all low-flying jets. Which famous oil expert says so? David Lenigas, the executive chairman of UK Oil & Gas Investments.
Heard of him? Yup, the same Mr Lenigas who was on the BBC only last Thursday, talking about a “strategic asset” for Britain, just along from air traffic control at Horse Hill. And, didn’t UKOG’s chief executive, Stephen Sanderson, also give a cracking interview? Not least that bit where he declared: “Based on what we’ve found here, we’re looking at between 50 and 100 billion barrels of oil in place in the ground” — or more than double the 43 billion extracted from the North Sea. No wonder, the shares shot up 176 per cent to 2.98p on the day.
Well, guess what? The duo have been asked by the stock exchange to issue a “clarification of press comment”, pointing out that nobody yet knows whether there’s any recoverable oil at all. So much for UKOG formally telling the market five days ago of a “possible world-class potential resource”, whatever its caveats over recoverability.
True, some press comment did need clarifying, the BBC’s, for example. It was reporting the exciting discovery before the stock exchange had even opened, swiftly producing an incredible piece complete with graphics and video.
Anyway, the upshot is that UKOG shares are now down to 2.15p, a 28 per cent loss for investors who bought at the peak. It’s a similar story, too, at the four other quoted companies linked via Mr Lenigas and his sidekick, Donald Strang, to Horse Hill. Since Thursday’s close, Stellar Resources is down 31 per cent, Doriemus 31 per cent, Solo Oil 22 per cent and Evocutis 12 per cent.
Such is the risk of following Mr Lenigas. Yes, money can be made trading around announcements. But, of 13 companies where Mr Lenigas has been a director in the past five years, there are only three, UKOG, Afriag and Rare Earth Minerals, where buying shares when he joined and holding them while he was there would have delivered a profit. Of the rest, poor performance and dilutive share issues would have wrecked your investment, with every £1 turning to as little as 13p at Stellar Resources, 16p at Fastjet and 26p at Solo Oil. Remember that next time yo
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