Small Talk: As with the country, in the oil business efficiency is all

Click to follow
The Independent Online

The spectacle of the Chancellor, George Osborne, wielding his axe with such alacrity last week is setting an example for Tim Heeley, the newly-installed chief executive of the AIM-listed oil and gas explorer Nighthawk Energy. Nighthawk has had a tricky run, plagued by a steadily falling share price and uncontrolled rumour-mongering on internet bulletin boards. But when the two founders, David Bramhill and Joe O'Farrell, stepped down from the board last month, it was nothing to do with such troubles.

Mr Heeley, formerly commercial director at Nighthawk, is trying to establish the most efficient way to get the estimated 1.4 million barrels of oil at the company's Jolly Ranch site in Colorado out of the ground. The company may have secured a £25m funding package earlier this month, to give it a "position of strength" in negotiations with potential partners for Jolly Ranch. Alongside last week's preliminary results, which showed that annual revenues soared by 332 per cent to $2.1m (£1.3m) with losses broadly flat at $1.28m, Mr Heeley took the opportunity to institute an Osborne-esque spending review.

"Having just been appointed CEO, it is too early to comment on specific initiatives that we will look to introduce over the coming months," he said. "However, it is important to stress at this stage that we will, as a priority, review spending to ensure that our resources are effectively targeted."

Meanwhile, Mr Bramhill, who remains a major Nighthawk shareholder, is turning his attentions to two other projects, Wessex Exploration and Osceola Hydrocarbon, both of which are gearing up to list on AIM early next year. "The departure of Joe O'Farrell and I from Nighthawk couldn't have been more amicable," Mr Bramhill said. "It was simply a question of corporate governance timings as Nighthawk moves to the next stage of development."

Wessex, in particular, which has a joint venture with Shell and Total set to begin drilling in French Guyana in 2011 and is also looking for oil beneath the rolling hills of southern England, will be one for AIM-watchers to keep an eye on.

Not everyone is feeling the pain

It looked like bad news across the board last week when the Government cut £81bn of public spending in what amounted to Britain's biggest fiscal consolidation outside wartime. But, as ever, there may be glimmers of light for some. While businesses across the country are squealing at the changes to the Government's carbon reduction scheme, which critics say turn it into a "stealth tax", the Lancashire-based smart metering company BGlobal may be a beneficiary.

BGlobal already has much to be proud of and is today named as the winner of the northern category in this year's Deloitte Technology Fast 50 competition. Thanks to a staggering 4,447 per cent growth in revenues over the past five years, BGlobal is also the highest-ranking of all AIM-listed companies. It is ranked sixth in the national top 50 – the top performer outside the London, the South-East and Cambridge regions which dominate the index.

Such booming growth may yet be helped along by the Chancellor. By adding more teeth to the CRC scheme, which forces organisations that are heavy electricity users to buy "allowances" for their carbon emissions, the financial incentive to control energy use will be even stronger. And BGlobal is its own best advertisement, shaving "12,000 off its annual electricity bill by using a smart meter.

So far the company, which was founded in 2004 and listed on AIM three years later, has focused on only the business market. But it also has plans to launch a domestic smart meter within 18 months. Given that there are more than 47 million domestic electricity meters in Britain, GGLobal's past five years of growth may be just the beginning.

Gold in them thar hills for Nyota

Barely more than a week before the EGM for shareholders to approve the recent £21.6m equity placing by Nyota Minerals, the company is taking nothing for granted. Nyota's latest drilling update suggests that the gold deposit at its flagship Tulu Kapi project in Ethiopia is even larger than the 1.38 million ounces formally booked so far. Ocean Equities, the broker which handled the recent placing, is now confident the total will pass the two million mark by the first quarter of 2011.

Nyota, which is listed on the AIM market in London and on the Australian Stock Exchange, also has interests in Burundi and Swaziland. But the 3,000 square kilometre Tulu Kapi site is its most advanced project.

The share price has already shot up from 8p to more than 17p this year. The extra £21.6m will fund ongoing work to extend proven resources at Tulu Kapi and help pay for exploration in the company's six other licence areas in Ethiopia. The government in Addis Ababa is paying increasing attention to the potential of mining and brokered an extra $330m for development from the World Bank just last week. Investors voting at the EGM certainly have plenty to think about.