Monument looks to spend pounds 250m on oil acquisition
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.MONUMENT OIL & GAS, the exploration company, is looking to spend its pounds 250m war chest on acquisitions in an effort to boost its critical mass and revive its flagging share price.
The chairman, Tony Craven West, said the recent slump in the oil price would provide Monument with plenty of opportunities for corporate action. The company could take over one of its smaller rivals, which were hit hard last year when Brent prices collapsed to a 13-year low.
The chairman said that any target was likely to be outside the UK, probably in the US, with assets in fast-growing oil-producing areas such as Pakistan. If a deal did not materialise, Monument could forge joint ventures.
The chief executive, Tim Eggar, a former energy minister in the last Conservative government, said the company was talking to several rivals, but was not in formal negotiations with any potential target.
The dramatic effect of the fall in the crude price on oil companies was highlighted by Monument's 1998 results. The company reported a 60 per cent fall in pre-tax profits to pounds 7.8m on turnover down 8.7 per cent to pounds 81.3m. The sharp fall forced the company to scrap its dividend.
City analysts said that Monument's saving grace was its Liverpool Bay gas field. The operations offer Monument a constant stream of earnings, as gas prices are much more stable than oil prices because they are linked to long-term contracts.
One analyst said that Liverpool Bay, acted as an "hedge against the oil price downside". He added that Monument was well placed to take advantage of the current oil price rebound thanks to its large exposure to the lucrative Caspian region.
He advised buying the shares, down 0.5p to 43.5p yesterday, as they are trading at a 20 per cent discount to Monument's net asset value of 55p.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments