Leni Gas & Oil PLC Lifts On Great Expectations For Latest Wells

Leni Gas & Oil PLC (LON:LGO) to begin preparing site for production after drilling well GY-668 to total depth.

Mark Stones

Mark Stones (TMFMumbojumbones) joined The Motley Fool in 2014 and initially worked as a writer for Fool.co.uk, before joining the Fool’s analyst programme. Mark earned a BA in English from Loughborough University. Although he spends more time reading annual reports than Russian literature these days, he still appreciates a novelist’s antipathy toward the accepted view, which is a useful attitude when trying to sniff out hidden gems on the stock market. His approach to investing has been largely influenced by the principles of Warren Buffett and Peter Lynch. He also takes a special interest in the work of healthcare companies. Outside of investing, Mark plays guitar, enjoys good writing and has a guilty passion for combat sports.

Published 1 September, 2014 12:58 pm BST

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Shares of Leni Gas & Oil (LSE: LGO) increased by 4% to 3.8p in early trade this morning — taking the oil exploration and production company to within a hair of having a £100m market cap — after revealing that well GY-668, the fifth well at the Goudron Field in Trinidad, has been drilled to a total depth of 3,026 feet.

LGO previously announced 191 feet of net oil pay in the Goudron Sandstones, while a further 254 feet of net oil play in the Gros Morne Sandstones — the primary target of the well — has been identified.

The wells, pending the necessary approvals, will be brought online one by one. The rig will subsequently be brought to the next drilling pad to commence the drilling of the next four development wells.

The chief executive, Neil Ritson, commented:

“The fifth well has been successful in meeting its objectives and the rig will shortly be moved off GY-668 and we will start the process of preparing the site for production. The pressures we have experienced during the drilling of these wells gives us considerable confidence that we will have excellent production rates.”

Shares of Leni Gas & Oil have gained 414% in 2014, steamrolling the benchmark FTSE All-Share index, which is flat year-to-date.

If you decide to ‘buy’ — based on the prospect of the continued drilling of successful exploration wells — be sure to consider whether or not you’re paying a fair or, even better, bargain price.