Hot Stocks Sumatec, warrants surge in active trades after update shows oil reserve up 31%

by **Cals** Tue 24 Jun 2014, 23:59

Hot Stocks Sumatec, warrants surge in active trades after update shows oil reserve up 31%

Business & Markets 2014

Written by Ho Wah Foon of theedgemalaysia.com

Tuesday, 24 June 2014 16:17

KUALA LUMPUR (June 24): Sumatec Resources Bhd and its warrants rose in active trades after the company released an update report on its oil and gas reserves at the Rakushechnoye oil and gas field in Kazakhstan.

In the update report supported by a table, Sumatec said in a filing with Bursa Malaysia: “The updated reserves for oil and gas have both increased, with most notably the oil reserves increasing by more than 30%.”

At 3.50 pm today, Sumatec – the top most active stock – rose 4 sen or 14.5% to 31.5 sen on trades of 163.86 million shares. It had hit a high of 32 sen earlier.

Its warrant, Sumatec-WB, rose 2.5 sen or 12.2% to 23 sen on trades of 56.45 million units. It was the fourth most active counter.

The business of Sumatec, the independent oil and gas production firm controlled by Tan Sri Halim Saad, focuses on proven oil/gas assets in Central Asia.

Sumatec has invested US$95 million into the Rakushechnoye Field and signed a gas development agreement with Markmore Energy (Labuan) Sdn Bhd in December 2013 to develop gas from the field.

“Since taking over the operations of the field, Sumatec has started its workover program to ramp up the production to 2,000 bbls per day by end of 2014. Sumatec also reviewed all of the stratigraphic log data and recent production data with SRK Consulting (Australasia) to update the Feb 2013 reserves report,” said Sumatec in its filing.

SRK independently verified the technical evaluation and prepared a reserves update in May 2014, it added.

“The updated reserves for oil and gas have both increased, with most notably the oil reserves increasing by more than 30% as shown in the table.”

According to the table, while oil reserves has increased, gas reserves have gone from “contingent” to “proved, probable and possible”.

In the statement, Sumatec CEO Christopher Layton Dalton said: “The increase in reserves is the first significant achievement for Sumatec with this asset.

“An additional 10 million barrels of oil is now available under 2P reserves to Sumatec (worth an estimated US$175 million in net profit from oil sale) without paying any more than the initial US$95M,” he said.