Bridge Surges as Asha Deal Boosts Sale Options: Oslo MoverStephen Treloar
Bridge Energy ASA, a Norwegian oil explorer, rose the most in a month in Oslo trading as an agreement to combine the development of one of its finds with a larger discovery opens up for a possible sale of the stake.
Shares in the Nesbru, Norway-based company rose as much as 9.1 percent, the most since Feb. 6, and were up 1.8 percent at 11.2 kroner as of 2:18 p.m. in the Norwegian capital. More than 331,000 shares have traded so far today, more than triple the three-month average daily volume.
“It’s clearly positive for Bridge,” Morten Lindbaek, an analyst at Fondsfinans ASA, said by phone from Oslo. The deal will allow Bridge to sell its stake in a more mature asset to finance investments as an explorer, he said.
Bridge, which has assets in the U.K. and Norwegian areas of the North Sea, is seeking to boost production to fund a “high impact” exploration portfolio as oil prices have almost tripled since the end of 2008. The company’s estimate of contingent resource more than doubled, rising by 37 million barrels of oil equivalent to 66 million barrels of oil equivalent as of Dec. 31, it said Feb. 26.
The Asha find in the North Sea will be included in the development of the nearby Ivar Aasen deposits, which is operated by Det Norske Oljeselskap ASA, in a deal between the license holders, Bridge Energy said in a statement today. Statoil ASA owns 50 percent of Ivar Aasen.
The deal “accelerates and unlocks significant value’ in the license, Chief Executive Officer Tom Reynolds said in the statement. “Further upside potential exists on this license within the independent Aglaja and Amol prospective targets,” Reynolds said.
“They will keep to the explorer strategy,” Lindbaek said. “There are a lot of companies that would be interested in having a stake in that license.”
Bridge holds a 20 percent stake in license 457. Wintershall AG is operator with a 40 percent stake, while Verbundnetz Gas AG holds 20 percent and EON AG 20 percent.
Bridge may be a takeover candidate due to the low price of its shares compared with the value of its assets, Pareto Securities ASA said in a note yesterday.
Shares in Bridge Energy have gained 17 percent so far this year, giving the company a market value of 717 million kroner ($126 million).