COMPANY SNAPSHOT: Premier Oil, Afren, Richland Resources, Forte Energy, Oracle Coalfields, Red Rock Resources

FTSE 250 oil firms Premier Oil (LON:PMO) and Afren (LON:AFR) were at the centre of attention this morning after both companies provided drilling updates.

While the news from Premier was disappointing, with the company taking a decision to plug and abandon the 21/28a-11 well, Afren announced that its partner Eni has started drilling the Nunya-1X exploration well in Ghana.

Premier Oil said the East Fyne Appraisal well, 21/28a-11, will be abandoned after it encountered oil bearing sands with thickness at the lower end of expectations.

The results of the East Fyne Appraisal well will be incorporated into the Greater Fyne Area plans with Premier set to make a decision whether a commercial development is viable in the second quarter of 2012.

The Sedco 704 rig will now move to drill the Premier-operated Bluebell prospect in license P1466 in the Central North Sea. The results of this well are expected in March 2012.

In the meantime, Afren reported that Eni has spudded the Nunya-1X exploration well on the Keta block, which is located in the Volta River Basin offshore Eastern Ghana.

The well is targeting Upper Cretaceous deep-marine fan sandstones that are analogous to those that have yielded significant discoveries elsewhere along the West Africa Transform Margin, said Afren.

“Having made a successful start to our 2012 exploration drilling campaign with the Okoro East discovery, and with the JS-2 exploration well drilling ahead in the Kurdistan region of Iraq, the company is firmly engaged in its most active phase of exploration activity to date,” said chief executive of Afren Osman Shahenshah.

Afren said each of the multiple wells planned across its core areas has the potential to “materially increase” its discovered reserves base.

The group currently holds a 35 percent participating interest in the project after farming out a 35 percent interest in the block and transferring operatorship to Eni.

It has also been a busy morning for mining companies including Richland Resources (LON:RLD), which announced a resource upgrade at its tanzanite mining operation in Tanzania and Forte Energy (LON:FTE), which has secured further uranium projects in Mauritania.

Richland has upgraded the resource – which is compliant with the JORC standard – for its tanzanite mining operation in Tanzania to 105 million carats including 30.6 million carats in the indicated category.

Life of mine has been extended to around 30 years utilising the indicated resource alone and based on ramped up production of 2.7 million carats.

Moving to Forte, the company has secured two new uranium exploration permits in Mauritania, licenses 1588 - Nord Tmeimichat Rhall Amane and 1173 - Bir Ould Ben Nasser.

These two licences, which cover an area of 1,325 square kilometres, are located close to the company’s existing licences in the north of the country.

The company now holds ten uranium exploration permits within Mauritania for a combined area of over 9,925 sq km in addition to its Firawa and Bohoduo uranium prospects in Guinea, which total 847 sq km.

Other news in the sector included the results of the technical feasibility study on Oracle Coalfields’ (LON:ORCL) Block VI of the Thar Coalfield. The study has estimated the capital expenditure for open cast mine development at US$610 million for 5 megawatts per annum of lignite production.

The license area hosts mineral resources of 529 millions of wet tonnes with a gross calorific value of 3.18 million calories per wet kilogramme.

“The FS indicates the technical and economic viability of the mining project,” said chief executive of Oracle Shahrukh Khan.

“The board looks forward to progressing the technical feasibility study to bankable standard in 2012, when we will also be seeking direct funding for the mining project.”

Meanwhile, Baobab Resources (LON:BAO) said that member of the World Bank Group and its partner in the Tete joint venture has supported the 2012 exploration programme through a pro rata contribution of around US$1.9 million.

IFC remains Baobab’s single largest shareholder with an interest of 5.78 percent. Under the terms of the Tete joint venture agreement, IFC has committed to annual pro-rata contributions to the development of the project.

Baobab funds the remaining portion and remains the project operator.

“The corresponding contribution in 2011 was approximately US$1.29 million and we anticipate that the IFC will become more involved as the project progresses, for example in the facilitation of access to port, rail and power infrastructure,” said chairman of Baobab Jeremy Dowler.

Meanwhile, Red Rock Resources (LON:RRR) has agreed to sell a 50 percent interest in its 1.5 percent gross production royalty over any production from the Mt Ida iron ore project to Anglo Pacific Group (LON:APF) for US$14 million.

The project, which is located in Western Australia, has a maiden JORC compliant inferred resource of 530 million tonnes at a grade of 31.94 percent iron.

A scoping study completed in March last year showed the operation could produce 10 million tonnes per annum of magnetite concentrate grading over 68 percent iron.

A feasibility study is underway for completion by the end of this year.

Elsewhere in the sector, Stellar Diamonds (LON:STEL) reported “encouraging” diamond grades from Lion-5 kimberlite project in Kono, Sierra Leone.

Lion-5 was mapped over 1,990 metres with an average width of 1.5metres at the bulk sample site with 346 dry tonnes of kimberlite sampled yielding 244 carats for in-situ grade of 70 carats per hundred tonnes.

“These results indicate that the Lion-5 kimberlite has significant exploration potential,” said chief executive of Stellar Diamonds Karl Smithson.

Sticking with miners, Sunrise Resources (LON:SRES) announced high grade results from analysis of drill core from its first drilling programme at the Derryginagh barite project in south-west Ireland. These results included an intersection of 3.6 metres grading 89 percent barite and an interval of 3.2 metres grading 61 percent barite.

Mineralisation remains open at depth and along strike.

“These results confirm that high-grade extensions to the Derryginagh barite vein system exist well below the old mine workings, and below the level of previous drilling carried out in the 1980s,” said executive chairman of Sunrise Resources Patrick Cheetham.

“The dimensions of the vein system outlined by drilling to-date are encouraging and further feasibility studies are justified.”

Finally, African Eagle Resources (LON:AFE) said today that it has closed the subscription agreement and issued and allotted 45.5 million shares to IFC at a placing price of 6.8 pence per share to raise £3.1 million, which will be used to finance the evaluation of the Company's Dutwa nickel project.

In other news, Altus Resource Capital (LON:ARCL) reported its half yearly results today, saying its unaudited net asset value (NAV) fell 7.4 percent to £71 million during the last six months of the year.

The company said that it “retains a strong cash position and significant gold weighting and is therefore well-positioned to take advantage of continuing volatility and depressed equity prices and to benefit from further strength in the gold price”.

In IT, Allocate Software (LON:ALL) posted revenues of £16 million in the six months to end November, a small increase over the £15.9 million it booked in the same period of 2010. Recurring revenue increased by 42 percent to £7.5 million and from 33 percent to 47 percent of total revenues.

Earnings before interest, taxes, depreciation and amortisation amounted to £1.6 million.

“As I stated in the trading update I am pleased with the momentum and performance of Allocate so far this year, and believe the underlying results demonstrate both points,” said chief executive of Allocate Ian Bowles.

Elsewhere in the markets, Equatorial Palm Oil (LON:PAL) has appointed Coastal & Environmental Services (CES) to conduct its Environmental and Social Impact Assessment as part of its strategy to source development bank funding for the next stage of expansion in Liberia.

The ESIA studies will take place at both of the company's concession areas namely the Palm Bay Estate and the Butaw Estate.

The firm has recently completed a study for the first biofuel project to be funded by African development banks, the Addax Project in Sierra Leone, paving the way for a €258 million loan agreement to develop the project.

E-Therapeutics (LON:ETX) has appointed Rajesh Chopra to the board as a non-executive director. The company said Chopra has “extensive experience of all phases of drug development, in drug portfolio management including acquisition of new assets, and of dealing with regulators and government agencies”.

Prior to joining e-Therapeutics, Chopra spent five years at AstraZeneca (LON:AZN) in the US and the UK.