No Pain, No Gain: It's worth a gamble on Britain's own oil potential

The sky-high crude price is bound to intensify the search for oil with more exploration ventures arriving on the stock market. Some investors will benefit; others will, as so many black gold enthusiasts before them, end up with little or nothing to show for their speculation.

There is no doubt, unless other fuels are successfully developed, that more oil must be found. With Britain's economic growth predicted to falter because of the runaway price, Chancellor Gordon Brown has urged oilmen to greater efforts. And, ever willing to get involved in popular crusades, Sir Richard Branson has let it be known that he is exploring the possibility of joining the oil rush and may even build refineries.

The major groups, British Petroleum and the rest, are already enjoying a veritable bonanza from the continuing high price. So are many smaller players. Shares of Burren Energy, with interests in such out-of-the-way countries as the Congo and Turkmenistan, have climbed more than sixfold from December's flotation price. It is producing oil and enjoying spiralling profits. But there have been casualties. One that has failed to cover itself in glory is Regal Petroleum .

I'm afraid many of the minor oil (and mining) shares that have cascaded onto the junior Alternative Investment Market (AIM) in the past year or so will be huge disappointments. So will many of those that take up the call to oil in the coming months. Indeed, it is worth remembering that some exploration shares have been drifting around for years, with their success measured by the number of times they have tapped shareholders for more cash.

As readers know, I am not a fan of smallcap exploration companies. Too risky, I feel. Often, only the nimble-footed investor achieves satisfaction. For every prosperous vehicle, there is a clutch of cash-absorbing no-hoppers. However, in the present highly charged climate surrounding oil shares, investors will be tempted to chance their arm. I am, therefore, offering a share for their consideration.

The company is called Oil Quest. In an international business that seems to specialise in the back and beyond, it has the distinction of concentrating its endeavours in and around Britain. David Bramhill, a resources man who has been round the block a few times, is the guiding light. The shares have been as high as 31.25p this year; they are now 16.5p, capitalising the operation at £7.3m.

Bramhill first felt the attraction of the oil industry as a 16-year-old apprentice with Rotork, the engineer. But it was not until 15 years ago that he became directly involved in an oil exploration enterprise, joining the board of Pan Andean, one of the companies in the orbit of Irish entrepreneur John Teeling.

Pan Andean, which produced a £1.2m profit last year, has its own distinct place in recent oil history. Some years ago its shares romped ahead to 138p, as excitement mounted that it had made a rich strike in deepest Bolivia. But the oil had "migrated" and in a few hours the shares crashed to around 30p. The current price is 11.5p.

Later, Bramhill was behind the development of two mining companies - Cambridge Mineral Resources and Hereward Ventures. He has also been involved in resources developments in and around the Falkland Islands. Now Oil Quest, a transmogrified Hereward, is his baby.

So far, it has not found any oil. Indeed, an Isle of Wight venture has just been abandoned. But it has other promising investments in the South (some not far from the highly successful Wytch Farm oil field) and the North-east, as well as a 30 per cent interest in a North Sea block. The Oil Quest policy is to take minority stakes in exploration ventures. Ideally, it likes to become involved when much of the groundwork is completed - thereby reducing costs. In addition to the North Sea block, the company has interests ranging from 5 to 20 per cent in 13 British locations.

It has some £3.2m in the bank and, as a legacy of its gold exploration days, a 7 per cent interest in Cambridge (worth some £500,000). It is a slow-cash-burning and tightly run operation, and could well hit oil long before it is forced to tap shareholders.

Its chairman, Michael Thomsen, also head of Cambridge, describes Oil Quest as a "solid, no-frills junior oil company". One day it should add production to exploration.

With high crude prices likely to be a long-term influence, more home-grown oil would be a bonus for Britain. There could be much more lurking in and around this country, surely one of the safest areas on earth for intrepid explorers. Oil Quest is, I believe, one of the most promising players in this volatile industry and is worth a modest flutter.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at

Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Recruitment Genius: Sales Executive / Foreign Exchange Dealer - OTE £40,000+

    £16000 - £40000 per annum: Recruitment Genius: A Foreign Exchange Dealer is re...

    SThree: Experienced Recruitment Consultant

    £20000 - £40000 per annum + OTE + Incentives + Benefits: SThree: Established f...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE 40/45k + INCENTIVES + BENEFITS: SThree: The su...

    Recruitment Genius: Collections Agent

    £14000 - £16000 per annum: Recruitment Genius: This company was established in...

    Day In a Page

    Refugee crisis: David Cameron lowered the flag for the dead king of Saudi Arabia - will he do the same honour for little Aylan Kurdi?

    Cameron lowered the flag for the dead king of Saudi Arabia...

    But will he do the same honour for little Aylan Kurdi, asks Robert Fisk
    Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

    Our leaders lack courage in this refugee crisis. We are shamed by our European neighbours

    Humanity must be at the heart of politics, says Jeremy Corbyn
    Joe Biden's 'tease tour': Could the US Vice-President be testing the water for a presidential run?

    Joe Biden's 'tease tour'

    Could the US Vice-President be testing the water for a presidential run?
    Britain's 24-hour culture: With the 'leisured society' a distant dream we're working longer and less regular hours than ever

    Britain's 24-hour culture

    With the 'leisured society' a distant dream we're working longer and less regular hours than ever
    Diplomacy board game: Treachery is the way to win - which makes it just like the real thing

    The addictive nature of Diplomacy

    Bullying, betrayal, aggression – it may be just a board game, but the family that plays Diplomacy may never look at each other in the same way again
    Lady Chatterley's Lover: Racy underwear for fans of DH Lawrence's equally racy tome

    Fashion: Ooh, Lady Chatterley!

    Take inspiration from DH Lawrence's racy tome with equally racy underwear
    8 best children's clocks

    Tick-tock: 8 best children's clocks

    Whether you’re teaching them to tell the time or putting the finishing touches to a nursery, there’s a ticker for that
    Charlie Austin: Queens Park Rangers striker says ‘If the move is not right, I’m not going’

    Charlie Austin: ‘If the move is not right, I’m not going’

    After hitting 18 goals in the Premier League last season, the QPR striker was the great non-deal of transfer deadline day. But he says he'd preferred another shot at promotion
    Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

    How Isis profits from destruction of antiquities

    Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
    Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

    'If we lose touch we’ll end up with two decades of the Tories'

    In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
    Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

    The Arab Spring reversed

    Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
    King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

    Academic claims King Arthur was real - and reveals where he lived

    Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
    Who is Oliver Bonas and how has he captured middle-class hearts?

    Who is Oliver Bonas?

    It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
    Earth has 'lost more than half its trees' since humans first started cutting them down

    Axe-wielding Man fells half the world’s trees – leaving us just 422 each

    However, the number of trees may be eight times higher than previously thought
    60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

    60 years of Scalextric

    Model cars are now stuffed with as much tech as real ones