Future port tolls – of $10 (£5.3) a tonne on booming exports of Russian light sweet crude oil – and potential oil finds in western Siberia could augur well for Baltic Oil Terminals.

Set up with backing from RAB Capital by chief executive Simon Escott, an ex-World Bank luminary and experienced Russian hand, Baltic raised £23m at 140p in April to build an oil terminal in the Russian Baltic port of Kaliningrad. Baltic owns 58.5% of Tetoil, which is the company building the terminal with capacity to handle 5.8 million tonnes a year at Kaliningrad, Russia's only ice-free port on the Baltic.

Construction of the terminal began on time last month and Scott, who has recruited some heavy sector hitters to the board, says work is advancing on schedule. April's float has enabled the company to weather hefty interim losses of £2.7m and still retain £19m cash, as well as allowing RAB to cash in many of its chips.

Escott argues Russian oil is more suited to European refineries than (dwindling) Middle Eastern supplies and produces fewer noxious emissions. He suggests the company might consider expanding its terminal operations.

As well as profiting from its transhipment through Kaliningrad, Baltic has a joint venture, KNG, with well-connected Nasdaq-OTC-quoted Siberian Energy. This will explore for oil in Kurgan, a region of Siberia near the border with resources-rich Kazakhstan. Escott says drilling results are expected from the first block there in mid-October.

House broker Arden expects Baltic to lose £5.1 million in the full year before turning that round in 2007 to make £7.4m pre-tax on £11.9m of sales, with £18.6m pre-tax on £24.2m sales likely for 2008. Speculative Buy.

Baltic Oil Terminals	AIM	£5.86m	10.50p	0.00p
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