AFRICA OIL: GOOD LOCATION TO STEP IN SHARES - HSBC
STOCKHOLM ( AFX) It is a good location to enroll in the oil exploration company Africa Oil's ownership rolls .
It says HSBC in an up to date analysis with an initial overweight recommendation and price target of around 60 SEK .
The investment bank points out that many research houses were in favor of the oil company in recent years, but that the upcoming drilling program may offer a hefty upside potential if it proves successful .
Certainly underlines HSBC Lundin company has been successful in the Kenyan South Lokichar Basin , where the Company encountered oil in seven of eight wells.
However, targeted research house in on second exploration areas than South Lokichar , and stresses the East African oil company will drill into five so-called basins of Kenya and Ethiopia over the next year in the hope of finding more oil.
Bank points out parallel to exploration drilling often involves high risk , and that Africa Oil will have to bring in more money in the future to maintain its drilling program , possibly through additional share issue.
With regard to significant events in the near future mentions research house appraisal well in Kenyan Twiga South and the exploration well Sala in Kenya.