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Imminent Colombian reserve figures for oil and gas explorer Gold Oil could revive bid interest, claim bulls.

Two seasoned exploration and production men, chief executive officer Gary Moore and chairman Michael Burchell, steer AIM-quoted Gold Oil, which has interests in what they suggest could prove to be more than 130 million barrels of oil in Colombia and 1.25 billion equivalent barrels in onshore and offshore gas and oil blocks in Peru. The London-headquartered company, which says it expects the new Colombian reserve figures in two weeks, says drilling will start in December at its 40 per cent–owned Rosa Blanca prospect, while its 20 per cent-owned Azar block to the south is also coming into production.

Gold Oil, which argues Colombia’s FARC terrorist organisation is now in abeyance and local land prices are surging, says its prospects in the country recently prompted a bid approach from a well-connected local group. The suggested terms did not satisfy and the approach lapsed, but speculators suggest new reserve figures might revive interest from the same quarter.

The company is also interested in the potentially major onshore oil and gas Block XXI in Peru, described by directors as ‘the size of 13 North Sea blocks’, and has the licence for Peru’s extensive but as yet unexplored offshore Z34 offshore Talara prospect. Noting that Shell is committed to spending £170 million to the north of XXII, Gold Oil is cautiously looking for partners.

The company, which has an option on 35 per cent of £190 million petrochemical and ammonia plant being built by German engineer Man Ferrostaal, is also seeking to find a way to tap some of Cuba’s hitherto dormant energy potential. Burchell and Moore contend Gold Oil, with no debt, £5 million cash and commitments to spend up to £2.8 million, has potential resources of nearly 1.4 billion barrels, worth $690 million (£405 million) at a heavily discounted $5 a barrel – against a $70 market price.

That compares with today’s market value of £19.3 million at 4p, down from 17.5p in late 2006. With welcome or unwelcome bid possibilities rumoured, it all adds potential speculative spice to the shares, despite the stock market’s current aversion to exploration counters.   

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Gold Oil	AIM	£27.54m	5.70p	0.22p
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Other company articles:
Exploration Insights by Robert Tyerman			03/11/2008
Reserve hope at Gold Oil			22/10/2008
Colombian deal for Gold Oil			09/07/2008
Gold Oil to get cash boost			26/10/2007
Gold Oil has success with first drilling			18/08/2006