Kim Eng on 5 Mar 2012
Background: Interra Resources Limited (ITRR) is engaged in the business of petroleum production, field development and exploration. It currently has established oil and gas interests and operations in Australia, Indonesia and Myanmar.
Recent development: ITRR recently released strong FY11 results. The current white-hot interest in Myanmar has seen its share price appreciating by more than three-fold in two months. The company holds 60% of the rights and interests to two of the largest onshore oil fields under Improved Petroleum Recovery Contracts in Myanmar, which have about five more years to run (ends March 2017).
Profiting from production and oil prices. ITRR reported strong FY11 results which were mainly due to higher oil production and oil prices. The weighted average SLC oil prices transacted improved 40% over FY10, whereas overall production increased by 19%. Notably, oil production from Myanmar has improved by 11%.
Price run-up justified? With ITRR in oil exploration, the sales of oil reserves are subject to fluctuations of the global oil markets. There are no direct links between Myanmar’s liberalisation plans and ITRR’s fortunes, except through management’s expertise to negotiate profitable concessions. This remains to be proven, as liberalisation might allow larger competitors a convenient entry opportunity.
Plans ahead. ITRR intends to seek new concessions to strengthen its regional presence and to raise funds this year to meet its goals.
No comments:
Post a Comment