Africa Oil Corp. (CVE:AOI), a Canadian oil exploration company with assets in Eastern Africa, plummeted to the lowest in six months after reporting a wider quarterly loss that disappointed analysts, and saying that a well in Kenya failed to find viable crude deposits.
Africa Oil shares fell to C$7.41, the lowest intraday price since Sept. 12, and were trading at C$7.47, down 13 percent, at 2:27 p.m. in Toronto.
Net loss expanded to $38.3 million, or 13 cents per share, in the three months ended Dec. 31, from $9.6 million, or 4 cents per share, in the year-earlier period, the Vancouver, British Colombia-based company said in a statement today. Analysts were looking for per-share loss of 2 cents.
Operating expenses increased $22.9 million for the fourth quarter compared to the same period in the prior year. The Company recorded a $22.9 million impairment of intangible exploration assets relating to Block 10A in Kenya in the fourth quarter as the company relinquished the block late in the year.
In the first quarter of 2013, the Tullow Oil Plc–Africa Oil joint venture tested a Cretaceous play in the Anza Basin with the Paipai-1 commitment well in Block 10A in Kenya, encountering light hydrocarbon shows. Due to concerns over economic viability, African Oil and its partners have relinquished Block 10A, according to the statement.
The stock, which has 3 "strong buy", 8 "buy" and 2 "hold" recommendations from analysts, has lost 19 percent this year, leaving the company with a market value of C$2.3 billion.