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Ireland-focused oil firms boosted as FTSE 100 Index rises

The FTSE 100 Index closed 24.02 points up at 6209.63
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The licence awards were part of phase two of the 2015 Atlantic Ireland round

Ireland-focused oil & gas explorers were all the rage on Friday as they won licences to drill off the coast of the Emerald Isle.

News that Europa Oil & Gas Holdings Plc (LON:EOG) won four new licence options in the Atlantic boosted its shares by 3.12% to 4.12p.

The latest round is phase two of a process that began last year. Europa landed one option in the first stage.

Chief executive Hugh Mackay said he was “delighted” to have bagged four this time around.

And Petrel Resources PLC (LON:PET) bounced 34.2% to 6.375p as it netted two new licensing options in the Porcupine Basin.

The awards were part of phase two of the 2015 Atlantic Ireland round announced by Irish natural resources minister Seán Kyne.

But Eland Oil & Gas PLC (LON:ELA) leaked 5p to 26.25p on what it described as unsubstantiated speculation regarding security incidents in the Niger Delta.

It said it was unaware of any incidents on its properties and said its continuing maintenance and operational activity was unaffected.

There was positive news from Oracle Coalfields PLC (LON:ORCP), which is developing a combined lignite mineral resource and mine mouth power plant in Pakistan.

Oracle has signed a deal whereby a consortium of new and existing Chinese partners will take 70% equity in its subsidiaries in Pakistan to advance the development of the project. Its shares rose 18.5% to 3.2p.

Small-cap indices closed in positive territory and the FTSE 100 Index closed 24.02 points up at 6209.63, paring an earlier 61-point gain.

US non-farm payroll figures showed America added just 38,000 non-farm jobs in May, the weakest figure since summer 2011.

Market expectations had been for a 160,000 rise in non-farm payrolls, matching the seven-month low in April.

Russ Mould, investment director at AJ Bell, said: “A stunningly disappointing US non-farm payroll number for May could well put a further US interest rate hike on the back burner."

Oil prices were on the retreat again after a slight burst back above US$50, apparently fuelled by news of lower US crude stockpiles.

The price of a barrel of Brent crude fell back to stand at $49.8, while US light crude dipped to $48.9.

Investors checked out of supermarkets as analysts warned that Sainsbury’s PLC (LON:SBRY) was likely to report a dismal performance next week.

Sainsbury’s dropped 10.7p to 246.2p, Tesco PLC (LON:TSCO) fell 7.5p to 162p and WM Morrison Supermarkets PLC (LON:MRW)  lost 7.5p to 188.9p after Barclays said it expected Sainsbury’s to report a like-for-like (LFL) sales decline of -2.2pc in the first quarter.

Sainsbury’s is due to update the market on Wednesday.

Barclays said in a note: “If correct, then this would be the most negative LFL number reported by the company for two years.”

Sainsbury is buying Argos owner Home Retail PLC (LON:HOME) to try to offset the impact of competition from online retailers and discounters.

But analysts have voiced concern about how easy it will be for Sainsbury to integrate the catalogue retailer and whether it will distract it from its core food business.

Monthly market share data from Nielsen earlier this week showed the Big Four superstore groups are losing market share whilst those that generally run smaller, more focused, operations were making gains.

Meanwhile, the prospect of more consolidation in the drug industry emerged as rumours did the rounds that Astrazeneca PLC (LON:AZN) was among potential bidders for US nervous disorder treatment developer Acadia Pharmaceuticals Inc (NASDAQ:ACAD) .

The word in the City was that Astrazeneca and a clutch of others including Teva Pharmaceutical Industries Limited (TLV:TEVA), Biogen Inc (NASDAQ:BIIB) and Allergan (NYSE:ACT) were looking at Acadia.

Its products include Nuplazid, the first and only medication approved by the US Food and Drug Administration to treat hallucinations and delusions linked to Parkinson’s disease psychosis.

Gossips reckoned potential bidders had already had a word with major shareholders in Acadia, but had been told the investors would not accept less than about $60 a share.

Shares in Nasdaq-listed Acadia fell 2.6% to US$35.85 in mid-session in New York. The company did not respond to a request for comment before this report went to press. 

Astrazeneca’s stock closed 3p off at 4039p.

Shares in urban regeneration specialist Sigma Capital Group PLC (LON:SGM) climbed 3p to 92.5p as it unveiled a partnership with housing group Keepmoat Limited.

In small-cap world, Tanzania-focused mineral explorer Kibo Mining PLC (LON:KIBO) lifted 0.25p to 5.5p.

It said feasibility work on its Mbeya coal to power project advanced to a level where it said it could start a formal EPC-bid process for both the Mbeya power plant and the Mbeya coal mine.

But Eland Oil & Gas PLC (LON:ELA) leaked 5p to 26.25p on what it described as unsubstantiated speculation regarding security incidents in the Niger Delta.

It said it was unaware of any incidents on its properties and said its continuing maintenance and operational activity was unaffected.

Verona Pharma Plc (LON:VRP) backtracked 6.8% p to 3.1p as it reported progress in developing a drug to treat lung disease, but posted sharply higher annual losses.

In what is probably one of the biggest equity financings in junior mining this year, Hummingbird Resources Ltd (LON:HUM) raised £45million to develop its  Yanfolila gold mine in Mali.

Some debt financing will still be needed to get Yanfolila into production, but the new money means at least it can press on with detailed engineering work and then move to construction in three months. Shares in Hummingbird advanced 0.75p to 24p.

Amerisur Resources plc (LON:AMER) lifted 0.8% to 27p as it said it would wait until it has acquired electrical logs before deciding whether to complete the Jaguarete-1 well on its San Pedro property in Paraguay.

“The significance of the results will not be known until all data analysis and any additional operations on the well have been completed,” the company said.

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