Market Report: Hopes of Borders oil find lifts Falklands explorers

As foreign secretary William Hague condemned Argentina's dramatic seizure of oil assets that were located in its land but controlled by Spain's Repsol, British hydrocarbon companies operating in the waters around the disputed territory of the Falkland Islands enjoyed a splendid day.

In contrast to Repsol's plummeting share price, UK oil firm Borders & Southern Petroleum soared by an astonishing 55 per cent yesterday, shrugging off Argentina's claim to sovereignty over the Falklands and its threat to sue any company operating in the vicinity.

Borders & Southern's share jump (by 38.5p to 108p) came amid growing excitement that the results of exploratory drilling around the Falklands would determine commercial quantities of oil. This would put Borders in an exclusive club, since only Rockhopper has yet found commercial quantities of oil, after striking black gold at its Sea Lion field last year.

"The results are nearly on us. There's obviously nothing out at the moment but I guess it's just speculation as to a positive result," said one analyst.

The positive sentiment Borders engendered around Falklands oil contributed to meaty share price rises for rival explorers in the region, with Falkland Oil and Gas jumping by 24.25p, or 35 per cent, to 93p, and Desire Petroleum adding 1.25p to close at 29.25p.

In contrast to Argentinian land, upon which President Cristina can renationalise any foreign-owned assets she likes, Buenos Aires has no legal jurisdiction over the Falklands. Consequently, although Argentina is ratcheting up its campaign to extend its oil empire by grabbing the Repsol assets, investors in operators around the islands seem unperturbed by the country's threats of legal action.

Still on resources, Fresnillo turned in a glistening performance yesterday, dragging other miners up with it, jumping 3.24 per cent as the gold and silver producer delivered an expectation-busting first-quarter performance.

Fresnillo's shares increased by 51p to 1,624p, as the miner hiked gold production by 26.3 per cent in the first three months of 2012 to 121,792 ounces.

FTSE 100-listed, Mexico-based Fresnillo has been working hard to boost production to take advantage of the historically high gold price, which has risen steadily for most of the past decade and is expected to keep growing this year, after falling from its September record in the final months of 2011.

The company, which also reported an expectation-meeting 3.5 per cent decline in first-quarter silver production, said its gold output was primarily boosted by a 42 per cent jump in production at its eponymous Fresnillo mine in Mexico.

The mining sector was given a further boost when BHP Billiton reported a better-than-expected 8 per cent drop in iron ore output in the three months to the end of March.

This was largely due to interruptions to production as a result of a stormier-than-usual cyclone season and was in contrast to rival Rio Tinto's disappointing statement to the market on Tuesday, which reported a larger-than-expected dip of 11 per cent in iron ore shipments.

BHP's encouraging iron ore performance was complemented by a 35 per cent surge in petroleum "liquids" production from its US onshore gas business, which together outweighed disappointing coking coal production and saw the miner's shares leap up by 16.5p and end the day at 1,943p.

The strong showing from the resources companies helped to balance out declines elsewhere in the FTSE 100, although the blue-chip index still dipped slightly, falling 21.66 points to end the day at 5745.29.

However, it wasn't such a good session for interactive whiteboard maker Promethean World, which saw its shares tumble by 15.75p, or a hefty 21.5 per cent, to 57.5p, as challenging conditions, particularly in North America, dragged down the company's revenues by 14 per cent during the first quarter.

Furthermore, the FTSE Small cap education company, which is hobbled by the fact that 95 per cent of its businesses comes from governments around the world, warned that the market would remain challenging in the US and Europe.

This prompted Peel Hunt to downgrade its recommendation on the stock from "buy" to "hold".

Promethean's woes also pushed down shares of education specialist Pearson, which fell by 14.0p, or 1.25 per cent, to close at 1,119p.

Liberum Capital's analyst Ian Whittaker said: "There is a negative read across from the interim management statement from Promethean World, which is a global education interactive learning technology company that works with a number of the educational publishers."

Suggested Topics
Rumer was diagnosed with bipolarity, attention deficit hyperactivity disorder and post-traumatic stress disorder: 'I was convinced it was a misdiagnosis'
peopleHer debut album caused her post-traumatic stress - how will she cope as she releases her third record?
Arts and Entertainment
'New Tricks' star Dennis Waterman is departing from the show after he completes filming on two more episodes
tvOnly remaining original cast-member to leave long-running series
Life and Style
Couples have been having sex less in 2014, according to a new survey
Holly's review of Peterborough's Pizza Express quickly went viral on social media
Arts and Entertainment
musicBiographer Hunter Davies has collected nearly a hundred original manuscripts
A long jumper competes in the 80-to-84-year-old age division at the 2007 World Masters Championships
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
Walking tall: unlike some, Donatella Versace showed a strong and vibrant collection
fashionAlexander Fury on the staid Italian clothing industry
Arts and Entertainment
Gregory Porter learnt about his father’s voice at his funeral
Arts and Entertainment
tvHighs and lows of the cast's careers since 2004
Life and Style
Children at the Leytonstone branch of the Homeless Children's Aid and Adoption Society tuck into their harvest festival gifts, in October 1936
food + drinkThe harvest festival is back, but forget cans of tuna and packets of instant mash
Lewis Hamilton will start the Singapore Grand Prix from pole, with Nico Rosberg second and Daniel Ricciardo third
F1... for floodlit Singapore Grand Prix
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.

iJobs Job Widget
iJobs Money & Business

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam