Speculation that Sinochem has made a bid for Gulfsands (GPX)

The article below speculates that Sinochem is in takeover talks with Gulfsands (GPX) with a takeover price of c. £400m, or c. 325p per share.

http://www.thisismoney.co.uk/markets/article.html?in_article_id=490168&in_page_id=3&position=moretopstories

And now Reuters is running the same story:

http://uk.reuters.com/article/idUKTRE57T1B220090830

As is Arabian Business News and the New York Times:

http://www.arabianbusiness.com/566310-gulfsands-in-takeover-talks-with-sinochem--report
http://www.nytimes.com/reuters/2009/08/30/business/business-uk-gulfsands-sinochem.html

Of course Sinochem has already agreed a 750p or £532m bid for Emerald Energy (EEN). The common asset between the two companies is Block 26 in Syria.

The sad thing for Emerald shareholders is that the Gulfsands deal at the rumoured price would effectively put only a ~£130m price tag on Emerald's Colombian assets. These include the very significant Capella field which has estimates as high as 1.1bn barrels in place, Gigante (where we still do not know the full results of testing the Caballos or the Tetuan) and the recently drilled Mirto prospect, where drilling results are now well overdue.

Bid Agreed for Emerald Energy

Of course a 750p bid has now been made for Emerald and agreed by the board.

This is below what many investors hoped for. However, the major shareholder, Waterford, run by Michael Kroupeev, has subsequently announced he is making a major investment in Sterling Energy (SEY). This perhaps explains the hurried nature of the Emerald transaction and its timing. Key Emerald directors, Alastair Beardsall and Keith Henry are also becoming directors in Sterling Energy.

Emerald Announcements:

http://www.emeraldenergy.com/Letter_from_the_Executive_Chairman.pdf

http://www.emeraldenergy.com/Rule_2.5_Announcement.pdf

Sterling Energy Announcement:

http://www.sterlingenergyplc.com/placing14aug.aspx

Canacol Commissions Reserve Report for Capella

Canacol Energy (10% holder of Emerald's Ombu block) has commissioned a reserves report for the Capella field to be carried out to the standards appropriate for its Canadian Listing.

The results are expected during September 2009.

http://www.theenergynews.com/news/article.php?storyid=33493&ftptype=1

If these results are better than expected, one may speculate that a counter bid for Emerald may become more likely.

Block 26 Syrian Update

Both Emerald Energy and Gulfsands have given encouraging updates on progress in Syria.

In summary:

• Khurbet East now producing 14,700bopd gross, 4,000 bopd more than before.
• KHE-12 delineation well may result in a reserves increase.
• Workover rig to conduct further testing on KHE-7, Yousefieh-2 which may result in additional reserves being booked.

This looks like a low cost way to increase reserves at the time bid rumours are swirling round both companies. Hopefully, they will get enough time to re-enter KHE-1 and drill an appraisal well on the K-Dolomite before either company is taken out.

http://www.emeraldenergy.com/PR20090806.htm

http://www.gulfsands.com/s/NewsReleases.asp?ReportID=358783

La Cortez Raises Finance

La Cortez has completed its private placement to raise $6.3m. The funds will be partiqlly used to develop Maranta. Perhaps an indication of what the test results may hold.

http://finance.yahoo.com/news/La-Cortez-Energy-Announces-bw-2033062194.html?x=0&.v=1