BPC

Offshore Bahamas oil play BPC has agreed a joint venture with major Norwegian producer StatoilHydro on new licences.

Chaired by veteran Aussie oilman Alan Burns, depressed BPC says the joint venture covers areas in the south-west of the Bahamas where it has licence applications awaiting approval from the authorities. Dr Paul Crevello, chief operating officer, says he hopes the licences, next to existing BPC licence areas, will be awarded before the year-end and suggests the commercial and financial terms of the joint venture agreement will then be finalised.

Crevello argues that the last serious explorer in the area, Tenneco in1987, found ‘very good indications’, but lacked the technology at that time for what was then considered very deep water work. He cites a ‘competent persons report’ indicating a potential 500m barrels in BPC’s existing southern Bahamas licence area and a US Geological Survey report suggesting a possible 7bn to 14bn barrels of oil equivalent in the offshore north-west Cuba Basin.

BPC shares collapsed from 16p to 1.62p between 2006 and last January and now trade at 2.25p. Though clearly not risk free, they could rally if this new agreement yields concrete results.

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