Companies: BLT    FOGL   

As foreshadowed here in July, resources giant BHP Billiton is taking an interest in two Falkland oil and gas licences.

Under the agreement, BHP Billiton, the world’s largest mining and resources company, is taking a 40 per cent stake in Falkland Oil and Gas Ltd’s (FOGL’s) 2002 and 2004 licences to the south and east of the Falkland Islands. BHP Billiton is to become the operator of the licences and, as well as paying £5 million to FOGL to repay past costs, is committed to drill at least two exploration wells over the next three years.

The agreement also gives BH Billiton the option to increase its stake in the licences further, to 65 per cent. Recommended as a ‘gamble’ at 99p by Growth Company Investor two years ago and highlighted again in July at 123p, FOGL shares are 8.5p up today at 173p, within hail of their 178p 2006 high and valuing the company at £156.4 million.

Hold on.

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