un article du Herald Tribune où on parle de JJ Limage

par mareva , Barjac, mardi 19 septembre 2006, 18:24 (il y a 6632 jours) @ mareva

Robust independents: Fodder for oil majors>

Robust independents: Fodder for oil majors>
By Patricia Brett International Herald Tribune

Published: September 17, 2006
PARIS Soaring oil prices have pumped up oil company profits and share prices, some more than others. Shares of integrated oil majors like Exxon Mobil of the United States or Total of France, invested along the whole industrial chain from well to gasoline pump, have risen 50 percent to 80 percent over the past three years - a modest clip compared with some smaller independent oil explorers whose market values climbed several hundredfold.

A case in point is Maurel & Prom, a sedate French trading company founded in the 19th century that turned its attention to exploring for oil in 1998 and found it in Congo three years later. Its share price has soared from less than €2 to a peak of €21.50 last year, although it has since slipped back to €17.37 at the close of trading Friday in Paris.

"The difference between small companies and big ones is that there is no hope for a big company to discover a new field that will dramatically change its reserve position," Jean-François Hénin, chief executive of Maurel & Prom, said in an interview.

Large oil companies need to find "elephant" fields, with reserves of 200 million barrels or more, to justify their exploration management costs, Hénin said. Small companies can make money on a field of 10 million barrels - and if they find one, it can turn their asset profile from ugly duckling to golden goose.

While downward reserve revisions can hit a major oil company's share price hard - as Royal Dutch Shell found in 2004 - the upside potential for the majors from additional reserves is limited. "Today the major players in the industry are the state oil companies of the producer countries, rather than the oil majors," Hénin said. "There's no possibility for Shell, or BP or Total to move their price by more than 5 to 10 percent."

In contrast, "in the case of Maurel & Prom and its peers, which have concentrated their activities in the upper part of the upstream, that is, more in exploration than production at this time, it is very possible to make a discovery that can double the share price of the company, or more."

Another example is Cairn Energy, a British exploration company that struck oil in Rajasthan state in India in 2004. "The discovery in Rajasthan tripled their reserves, and their share price," Hénin said.

Small and medium-size oil companies fall into two main categories, industry analysts say.

Some specialize in secondary recovery, buying depleted fields from the major companies as their output declines and applying specialized technology to glean oil that is not plentiful enough to interest the original owners. For such companies, the reserves are known, but the price of oil can make a huge difference to their revenue, and value.

Others are discoverers. Like 19th- century prospectors, they stake a claim in an exploration permit and start drilling.

Maurel & Prom started with three prospects. A Vietnam natural gas play was unsuccessful and was written off in 2002. An attempt in Cuba was little better. The venture in Congo, acquired from an oil major that had found oil but decided the potential was too small compared with offshore prospects, turned up the M'Boundi field, holding now-proven reserves of 258 million barrels - for a company like Maurel & Prom, liquid gold.

Maurel's net profit this year could rise to €140 million, or $177 million, from €100.3 million in 2005, said Antoine Leurent, an oil analyst with KBC Securities in Paris.

Jean-Jacques Limage of Fideuram Wargny forecasts an even higher rise, to €250 million this year.

Yet, in July, the stock price plummeted to €13.75. Investors felt that potential extraction costs at M'Boundi were high, Limage said, and the company needed to seek new sources of growth.

Hénin did not disagree. "The M'Boundi situation was like a dream," he said, "and the dream was also supported by rumors of a takeover."

"The period of dreaming has come to an end - we know the size of the field - and the speculation has also turned out to be a legend."

Discoveries can be bought and sold, and discoverers too. The lot of many independent oil companies is to acquire permits, find significant reserves - and be gobbled up by a major.

"This will probably be Maurel & Prom's final destiny, though maybe not right away, " said Leurent of KBC Securities.

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mareva