Petrominerales Falls on Output Decline, Dry Well: Bogota Mover
Petrominerales Ltd. (PMGC), a Calgary- based oil company that operates in the Andean region, slumped after saying production declined in August and new tests at a Colombian exploration well showed only water.
Shares fell 15 percent to 15,100 pesos at the close of trading in Bogota, the largest drop since Aug. 2. The stock is down 53 percent this year, the worst performer on the benchmark Colcap Index, which has climbed 7.1 percent.
The potential of Petrominerales’ Bromelia exploration well in eastern Colombia “has wilted,” RBC Capital analysts Nathan Piper and Theresa Pfab wrote in an e-mailed report as they cut their rating to the equivalent of hold from buy. Production, which averaged 31,113 barrels of oil a day in the second quarter, was 19 percent lower in August at 25,235 barrels, the company said.
“After a relatively barren exploration campaign the company, in our view, needs to convince investors it has the geological nous to deliver,” the RBC Capital analysts wrote.
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