Shares in two exploration companies with Irish links rose strongly in heavy trade in London yesterday as Dana Petroleum soared by 34 per cent to 13.75p sterling and MinMet rose by 20 per cent to 2-1/2p.
Dana rose following a weekend press report that the company was in talks over a major North Sea acquisition. No one was available from the company for comment. The Mail on Sunday said the acquisition could double the group's size and push its market value to more than £160 million. Turnover of more than 48 million shares made it the most actively traded and one of the best performing London shares.
The shares traded represented 5.7 per cent of the issued share capital. "The report made sense and it would be good news if the company boosted its position in the North Sea", said one market maker. "There are also rumours of a big gas discovery there" he added. Separately, the Sunday Telegraph gave the shares a boost saying the shares were "simply too cheap" at their then 10.25p. Dana realised £21.05 million from the sale of some of its UK assets and compensation from the release of a gas contract, last February. It said it would use the proceeds to finance its growth programme over the following 12 months and to reduce debt.
In May it announced the signing of three new production sharing contracts offshore Mauritania, West Africa. In July it acquired a portfolio of British upstream assets from DSM Energy, the Dutch company £2 million cash.
Meanwhile, turnover in MinMet stock topped 23 million shares after the company's chairman, Mr Jeremy Metcalfe, appeared for 60 seconds on a television show encouraging investors to buy the shares.
Speaking on the Channel 4 game show Show me the Money, Mr Metcalfe said that over the past four years the stock had increased by 1,500 per cent, taking the company's market value to £50 million from under £1 million. He said the shares were highly liquid and company had 30 institutional investors on board.
The company is developing a gold leaching technology process which Rio Tintod Plc which will allow mining companies wash gold out of the ground. "We're getting very high recovery levels. The next stage is to build a full scale demonstration plant which will take about 18 months."
The current low price of gold was not a worry for the company, he said. "We have acres and acres of bulk, low cost, mining potential in Brazil in the order of $30-70 an ounce, compared with a world average cost of mining an ounce of gold around $210. It is working very much in our favour."
