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Deltic Energy shares could be worth 13.7p as North Sea exploration advances - Allenby

“We see scope for positive news flow over the next few months," Allenby said.

Deltic Energy PLC - Deltic Energy shares could be worth 13.7p as North Sea exploration advances - Allenby

As Deltic Energy PLC (LON:DELT) expands its North Sea portfolio, Allenby Capital sets a 13.7p per share risked valuation for the explorer - signalling particularly substantial upside from the current share price of 0.88p.

Allenby’s new marker represents an upgrade from a prior valuation of 9.8p per share.

On Thursday, Deltic confirmed it received six awards in the UK government’s latest offshore licensing round.

The newly added acreage spans a total of 2,155.5 square kilometres and is described as “highly prospective”. According to Deltic the awarded licences contain prospects that can be rapidly matured and greenfield exploration opportunities to diversify the portfolio.

READ: Deltic Energy expands North Sea footprint

Chief among the company’s opportunities is the Pensacola exploration venture, partnered with Royal Dutch Shell.

“We see scope for positive news flow over the next few months, not least from the evaluation of Shell’s recently obtained processed 3-D seismic over Pensacola,” Allenby analyst Peter DuPont said in a note.

“Following Pensacola, the Selene prospect is scheduled to be drilled in mid-2022.

“The recent 32nd Round UKCS licence awards greatly expands Deltic’s exploration potential in the CNS and particularly the SNS Carboniferous fairway. Here some highly prospective acreage has been obtained.”

DuPont added: “Our success case valuation for the three most advanced projects remains unchanged at 17.5p/share.

“The risked valuation on this basis is £120mln or 8.5p/share. The share price reflects a very cautious view of valuation and stands at a c.90% discount to our risked estimates.”

Quick facts: Deltic Energy PLC

Price: 1.325 GBX

AIM:DELT
Market: AIM
Market Cap: £18.63 m
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Deltic Energy doubles number of licenses in portfolio with six new deals

Deltic Energy PLC's (LON:DELT) Graham Swindells speaks to Proactive London after landing six awards in the UK government’s latest offshore licensing round. These provisionally awarded 6 new licences nearly doubles the number of licences in the portfolio from 7 to 13. One of the six awards is in...

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