No Pain, No Gain: Nighthawk swoops to conquer in difficult times
Saturday 17 May 2008
The No Pain, No Gain portfolio has suffered a number of uncomfortable reverses since the bottom fell out of the small-cap end of the stock market. So perhaps I can be forgiven for singing the praise of Nighthawk Energy, an AIM-traded group recruited last summer.
The shares joined at 44p. Last week they topped 100p. As frequently happens when a price milestone is breached, the shares promptly slipped back. But I believe that once the inevitable profit-taking is completed they will resume their upward flight.
Nighthawk, a US-focussed oil and gas player, arrived on AIM in the early part of last year at 25p a share, raising £10m. Experienced oilmen, led by chief executive David Bramhill, are behind the business, born only in 2006.
From the outset they concentrated on areas of the US that years ago were renowned for their oil and gas riches. But fields were abandoned, as extraction became increasingly difficult. With energy prices then a mere ripple of today's inflated levels, the US oilmen found their efforts becoming less and less profitable.
With the benefit of advanced technology Nighthawk, together with its US partner, Running Foxes, felt some of the abandoned pitches deserved another whirl. Today the company has a series of intriguing developments. I suspect more are in the pipeline.
Of course, there's many a slip 'twixt cup and lip. I have always been sceptical of small exploration groups and Nighthawk is the first to grace the portfolio. I must confess it was the management rather than the American dream that prompted its recruitment.
Gas is already flowing from the group's Cisco Springs site in Utah. In recent times, the development has been increased from 14,000 to 24,000 acres and Nighthawk's interest from 37.5 to 50 per cent. It is currently producing one million cubic feet of gas a day and output could hit four million a day by the end of the year when oil could also be on tap.
In his interim report Bramhill said: "Eighteen months ago the project was at an early stage with little drilling activity having taken place for decades. The ongoing drilling and development programme has advanced the project significantly and progress has been extremely encouraging."
A firm of oilfield consultants is currently examining the Cisco venture. An earlier survey put the value of the field at around £125m. A new appraisal is being prepared and there appears to be every chance the Nighthawk share could exceed the group's £200m capitalisation.
In a sense, that would mean the rest of the US adventure is in the pot at no charge. Yet it is anything but worthless. This month Nighthawk said its 50 per cent-owned Jolly Ranch exploration area in Colorado had shown promising results. At two wells, hydrocarbons have been encountered and casing has been set to test them. Normally, such action is not taken unless the driller is confident the well will go into production. Further land next door to Jolly Ranch has been acquired.
Among other developments there could be excitement over the Buchanan and Worden field in Missouri where Nighthawk and RF share ownership. It is next door to an 80 per cent-owned Nighthawk site, the Devon Oilfield in Kansas, where it is thought some 10 million barrels of oil lurk. There are hopes that Buchanan may also be oil rich.
Nighthawk and RF seem to have established a successful alliance. A leading US oilman, Steve Tedesco, runs RF. Most of the Nighthawk team was involved in takeover victim Oil Quest Resources. Bramhill and the other executive director, Joe O'Farrell, were on the board. Former OQR chairman, Michael Thomsen, is a director of some Nighthawk subsidiaries. He has been involved in exploration in 33 countries in a 31-year career.
Early this year, Nighthawk raised £14m, placing shares with institutional investors at 46p through stockbroker Hanson Westhouse. It is still in funds with some £14m in the bank.
In its last report, the group was in the red – an interim loss of £474,000. There are hopes it will soon be profitable, which would be a remarkable achievement for a fledgling oil and gas group. Too many exploration minnows appear to soak up cash but make little progress. Nighthawk seems to have made significant headway in a relatively short time.
- 1 What happens to your body when you give up sugar?
- 2 Licence fee: What is the BBC charge – and how will the changes affect you?
- 3 This is what the photographer has to say about the picture of a weasel riding a woodpecker
- 4 Delhi bus rapist blames dead victim for attack because 'girls are responsible for rape'
- 5 Have sex with your iPad thanks to the new sex toy no-one asked for
'Jihadi John': CAGE representative storms off Sky News accusing Kay Burley of Islamophobia
Durham Free School: 'Creationism taught at' free school facing closure
Ukip would cut billions from Scottish budget to fund English tax cuts
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
End of the licence fee: BBC to back radical overhaul of how it is funded
Ukraine crisis: Top Chinese diplomat backs Putin and says West should 'abandon zero-sum mentality'
iJobs Money & Business
£15000 - £18000 per annum: Recruitment Genius: This is a great opportunity for...
£50000 - £60000 per annum + Excellent Salary: Austen Lloyd: An outstanding new...
£20000 - £21000 per annum + uncapped commission: SThree: As a graduate you are...
£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...
Day In a Page
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
High Crest House covers an impressive 9384sq ft, with almost three acres of grounds including a tennis court and summer house enclosed by electric gates
A six-bedroom farmhouse with separate accommodation in converted stables. Situated in the village of Church Aston, within walking distance to the market town
A two-bedroom flat with under-heated walnut floors and bespoke built-in storage. The Tube and Clapham Common are a short stroll away
A refurbished seven-bedroom townhouse with staff quarters, cinema room, superb gym, steam room and plunge pool
A minimnalist four-bedroom home designed to the highest spec, featuring glass walls and a kitchen space lit by a glass roof
Hibernate during winter and make your living during the summer at this busy guesthouse with panoramic sea views, in the village of Lynton
A four-bedroom penthouse next to the Tate with direct views of St Paul's from two floors of luxurious living space
A four-bedroom detached home surrounded by spacious gardens and woodland, close to New Pudsey
An 18th-century, three-bedroom home near Langstone Harbour built from ships beams with vaulted ceilings and wood burning stoves
A five-bedroom semi-detached home with a mix of period and modern features in a popular and convenient location
This five-bedroom red-brick beauty overlooks the village green and sits in just under two acres of land
A three-bedroom villa with self-contained flat, minutes from Lake Windermere
A deceptively spacious, beautifully presented Georgian home with 3000sq ft of living space and five reception rooms
A five-bedroom Victorian home with four receptions, superb gardens and paddock in Pembury
An eight-bedroom house on the south side of the The Green with cinema, wine cellars and summer house
This 17th century beauty is full of rustic cosiness, while the detached home office means you can also run a business
Four exclusive apartments in a Grade II-listed former medical school with 2,275 sq ft of living space and 18ft ceilings
A five-bedroom terraced house on the popular Peterborough Estate, ideally located for both Eel Brook Common and South Park
A state-of-the-art farm-building conversion on the former Cliveden Estate, with 11,420sq ft of internal space, cinema and wine cellar
A three-bedroom, 15th-century cottage with original features in the picturesque village of Sissinghurst
A six-bedroom terraced house with large south-facing roof terrace, cinema room and wine cellar
A new seven-bedroom home built in Queen Anne-style with swimming pool and parkland views in Mortimer
A listed, four-bedroom farmhouse in the rural hamlet of Rushall with detached barn, four acres of gardens and paddocks
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads