No Pain, No Gain: Hope of second time lucky for Bolivian bonanza
Saturday 09 October 2004
Some companies, rather like individuals, are born survivors. Take the Dublin-based exploration group Pan Andean Resources (PAR). Once it appeared to be a busted flush. Yet it is now profitable and last week disclosed it had encountered "significant gas shows" at a field in Bolivia.
The shares made headway as the stock market applauded the South American strike by the Irish explorer. But longstanding shareholders could be forgiven for hoping history is not about to be repeated.
For PAR has an unenviable distinction. A dozen or so years ago, its shares suffered what must be one of the most spectacular one-day falls in the history of the stock market. One minute they were nudging 140p; the next they were struggling to remain above 30p. It was oil - or rather the lack of it - at a much-trumpeted Bolivian field that did the damage.
All the signs were that PAR was onto a winner. For months, investors had become increasingly excited about the potential of its Bolivian adventure. Rumours filtered from the jungle indicating a rich discovery. The shares made inexorable progress. Then an investor made an out-of-the-blue telephone call to the oilmen. He hoped to glean the extent of the find. Instead he discovered the well was dry. The company was flabbergasted. It had been awaiting confirmation of a strike. Eventually it issued a statement saying the oil had "migrated". The Bolivian adventure was over and PAR would apparently never explore again. But the chairman, John Teeling, and his team continued to prospect. They also built an income-producing business to go alongside what is an increasingly interesting collection of exploration sites. And in Bolivia these days PAR has a powerful friend: British Petroleum. Profits have hit £1.2m and expansion talks are in progress. The shares have, of course, never returned to their earlier, illogical, peak. They are now about 23p after plumbing 9p.
I am not keen on resource shares;there have been far too many disasters. They have, however, enjoyed a great run recently, with newcomers, most with more hope than substance, receiving warm receptions. I would ignore most of them, except for in-and-out flutters. But any investor seeking a more long-term investment could do worse than descend on PAR.
There is no relationship between PAR and Ofex, except that shares of the company running the eponymous fringe share market have also experienced a dramatic collapse. Like PAR all those years ago, Ofex is in deep trouble. Without a rescue deal, it would have run out of cash next month. Such an event would have been disastrous for investors holding shares in Ofex-traded companies. The City's third market started life when the London Stock Exchange abandoned the old matched-bargains facility, which had existed for decades, to accommodate companies that could not, or would not, join the main share market.
So Ofex (Off Exchange) was born to cater for such businesses. It also set about attracting more adventurous operations that were ill-equipped for a stock market presence. At first it thrived. And when, last year, shares in Ofex itself arrived, paradoxically on the rival Alternative Investment Market (AIM), it looked as though the third tier was set to become a significant share platform. A subsequent cash-raising exercise, combined with the arrival of the ex-AIM man Simon Brickles and the serial investor Luke Johnson, seemed to confirm its progress. But when the expected flood of new recruits failed to materialise and many constituents moved to AIM, revenue fell well below target. To add to the discomfort, costs spiralled and Ofex suddenly encountered the pressures many of its less successful constituents had endured.
A cash injection was necessary, not only for the company to survive, but possibly the market as well. It would seem the Jenkins family, which created and managed Ofex, will have to accept a reduced role. When Sid Jenkins started his stock-jobbing firm in 1948 he was a "diamond geezer" in a world dominated by the "old school tie" brigade. He thrived by dealing in out-of-the-way shares - Arsenal FC (an Ofex constituent) was one. His sons, Tony and John, continued the business but sold out at the time of the Big Bang market reforms in 1986. John resurfaced with a share-dealing firm and later created the Ofex market. At one time its capitalisation was £2.5bn. Now it is £1.67bn and companies continue to leave - with few replacements in sight.
I believe, as with PAR, the Ofex story will continue. But the shares, which at the start of the year looked attractive, are now only for brave gamblers.
Rain doesn't stop profits at Andy Murray's £600-a-night hotel Cromlix House
Think twice about investing in fine wine - it's a vintage ploy for the fraudsters
Five Questions On: GB Energy's new tariff
Santander's Kitti app aims to bring the good old cash kitty into the 21st century
Bank-beating exchange rates on your international payments
- 1 Sabrina Corgatelli: US hunting tourist posts picture of herself with dead giraffe after Cecil the lion outrage
- 2 Tom Cruise: Reporters banned from asking actor about Scientology
- 3 A-level results 2015: UK exam board OCR admits it 'estimates' hundreds of pupils' grades after papers 'go missing'
- 4 Dutch King Willem-Alexander declares the end of the welfare state
- 5 Giant Minion terrorises drivers in Ireland as 40ft inflatable blocks traffic on Dublin road
Is Britain really full up? Are migrants taking our jobs? Leading academic answers the most common anti-immigration claims
Calais Migrant Crisis: Deputy Mayor of Calais labels Cameron's use of 'swarm' as 'racist' and 'ignorant'
Chris Leslie: Jeremy Corbyn's anti-austerity agenda will harm the poor, says Labour shadow Chancellor
Landlords renting properties to illegal immigrants to face up to five years in prison
While we fixate on Calais, the Home Office is quietly deporting dozens of migrants on 'ghost flights'
Calais crisis: The seven claims made about the migrants - and the reality
iJobs Money & Business
£35000 - £37000 per annum + benefits: Ashdown Group: Contracts Executive - Cit...
£20000 - £25000 per annum + OTE £45K: SThree: SThree Group have been well esta...
£21000 per annum: Recruitment Genius: This is an exciting opportunity to join ...
Up to 70k DOE: Guru Careers: We are seeking an experienced Financial Director ...
Day In a Page
Built on a former chapel site, this impressive four-bedroom home boasts balconies, stunning views and contemporary modern living.
This three-bedroom house is situated in a quiet mews and set over three floors. Features include glazed staircases and high ceilings.
A period townhouse set over four floors, this five-bedroom home was built in the 18th Century and retains many original features.
With five bedrooms, this spacious home offers beautiful gardens and modern interiors - set within the popular market town of Bingley.
Set sail for this four-bedroom farmhouse in Cowes. With five acres of land and an indoor pool, this home oozes character. There is even potential to let a one-bedroom annexe.
A few miles from the seaside at Perranporth, this four-bedroom farmhouse sits amongst nine acres of idyllic grounds - including a lake and two barns used as holiday lets.
In the pretty market town of Bungay, this grade II-listed Mill House is arranged over four floors, offering four bedrooms and three reception areas.
This first-floor flat comes with two bedrooms, an impressive open-plan reception room and two lovely roof terraces.
This five-bedroom home comes with a range of outbuildings including a large barn which could be converted into a self-contained granny-flat or rental.
Moored at Taggs Island and reached via a pretty garden, this two-bedroom houseboat has a vaulted reception room and skylit garden studio - currently a beauty salon.
On the edge of the city, this six-bedroom home comes with an outdoor swimming pool and a large garage block that has annexe potential.
A contemporary house spread over three storeys, this three-bedroom detached home has large sliding doors that open out to the River Quaggy.
Moored in Chelsea's Cheyne Walk, this houseboat offers two double bedrooms and a teak deck that's ideal for al-fresco dining.
This former village bakery, dating back to the 17th century, is now a three-bedroom detached home just a few miles from the East Sussex coast.
On the picturesque Isle of Man, this four-bedroom character home has a ground-floor shop that's currently run as a newsagents and a flat that would make an ideal holiday let.
In a new collection of flats, this first-floor two-bedroom apartment offers ample entertaining space and a prime view of Furze Green from a private balcony.
This three-bedroom stone-built cottage currently trades as the village store with a restaurant in the annexe and family accommodation on the upper floors.
Previously two semi-detached properties, this five-bedroom home is spread over three floors with a large breakfast kitchen, orangery, office and gym on the second floor.
This five-bedroom home enjoys countryside views over the Blyth estuary to Southwold, offering flexible living space with a ground-floor annexe - ideal for use as a holiday let.
Close to the market town of Eye, this four-bedroom detached home offers a double-height living room which takes the place of the original, 19th-century, chapel nave.
Dating back to the 19th century, this four-bedroom home needs modernising. Spanning three storeys, the red-brick house has a fireplace, a small terrace and a cellar.
Just outside of Cambridge, this single-storey home offers three double bedrooms, a living room with vaulted timber ceiling and ladder steps that lead to a mezzanine study area.
This six-bedroom Georgian home is on three floors with open fireplaces, a two oven Aga, an annexe, and cottage gardens with outbuildings and a car barn.
A former coach house, Glebe Farm Stable is now a three-bedroom cottage with a double car barn, an attached office, kennels and an outbuilding that's currently used as a gym.
Located beside an impressive Victorian viaduct, this four-bedroom home has an open-plan living area that is glazed on two sides, with skylights and high ceilings.
A former furniture workshop, this three-bedroom home has high ceilings and painted brick walls, in a village setting only fifteen miles from the coast.
This five-bedroom stone townhouse features a pine staircase and an Inglenuk fireplace, double doors from the lounge give access to an enclosed courtyard.
This five-bedroom, detached home blends traditional and modern design; the sleek kitchen features a gas hob and oven set within an exposed chimney breast.
Capitalise on the fabulous views of Trevone Bay by taking two homes and creating one spacious boutique B&B. Just a cliff-top walk from Padstow.
Surrounded by woodland, this five-bedroom manor house has plenty of outdoor storage space in the form of three converted loose boxes, two smaller outhouses and a woodstore.
This six-bedroom home is set amongst three acres of grounds. Currently a large family home, Clift Hill has potential to make a B&B or countryside retreat, subject to change of use permissions.
This Grade II-listed three-bedroom home is situated on a private road, just a short walk from the sandy beaches of Frinton-on-Sea.
Less than five miles from Malmesbury, this four-bedroom cottage comes with equestrian facilities and gardens that extend to approximately three acres.
Spanning three storeys, this late-Victorian five-bedroom farmhouse is a spacious family home with a modern interior and B&B potential.
With an original church arch, this triplex one-bedroom church conversion has a light, spacious, feel and comes with a secure off-street parking space.
This recently-refurbished three-bedroom home has bi-folding doors that lead out to a decked seating area - ideal for alfresco dining this summer.
Well-located for coastal walks and popular restaurants, this detached four-bedroom home offers views over farmland, to the Solent, the Purbecks and Bournemouth.
If you love high ceilings, school conversions like this one are bang on the money. This two-bedroom flat is minutes from Burgess Park and the foodie haven at Borough Market.
Set within a church conversion in Bermondsey, this two-bedroom maisonette combines existing features, such as original arches and brickwork, with a contemporary finish.
This four-bedroom Edwardian home offers a combination of original features and contemporary design after a renovation by the current owners.
This four-bedroom home offers a vaulted ceiling in a breakfast room that's ideal for summer entertaining with doors that open to the patio and garden.
On the market for the first time in more than 50 years, this six-bedroom home is a project with vast potential - spread over three floors of living space.
Surrounded by rolling countryside, this four-bedroom barn conversion comes with a self-contained, one-bedroom annexe that could serve as an office or a holiday let.
Located near Harrogate town centre, this five-bedroom Victorian terrace is arranged over three storeys while a current study serves as an optional sixth bedroom.
A ground-floor flat in a country house, located a mile from Sway; this two-bedroom home would make an ideal weekend retreat on the edge of the New Forest.
On a popular residential lane in Caterham on the Hill, this four-bedroom family home offers a secluded garden and a convenient location for local schools and public transport.
Just a short walk from Westerham green, this three-bedroom cottage has a light kitchen with exposed brickwork and double doors that lead to a south-facing garden.
In a prime spot opposite the River Thames, this one-bedroom flat has an 18sq ft reception room with glass doors that open out to a private terrace.
Set in the hills above Llanwrda Village, west Wales, this 18th-century three-bedroom farmhouse has holiday-let potential from a separate barn conversion and annexe.
This charming end-of-terrace townhouse is arranged over three floors, with two double bedrooms and a private courtyard garden located at the rear of the property.