6th May 2014
Following a disappointing 2013 brokers are now far more upbeat on the future prospects for Tullow Oil with the shares firmly in ‘buy’ territory.
The FTSE 100 listed oil and gas explorer, which operates throughout Europe, South Asia and Africa has endured a rough 12 months. In 2013, a number of projects in East Africa, French Guiana and Norway failed to deliver and over the past 12 months Tullow Oil’s shares are down by 10%.
But in its latest market update, published in April, it highlighted a number of positive developments including drilling successes in Northern Kenya with further discoveries from three wells.
The market cheered the report and the firm’s shares have surged by 17% in the past month alone.
Helal Miah, investment research analyst at The Share Centre, tips the stock as a ‘buy’ for investors happy to take on some above average risk.
He says: “Tullow Oil is a company with an impressive history of finding oil. Success rates were positive between 2008 and 2012; however 2013 was very disappointing by their standards. As the first quarter of 2014 looks progressively better, we believe the company is capable of delivering good results from its exploration led growth strategy.
“Development works are on schedule helped by supportive East African governments who are keen on improving the oil and gas infrastructure.”