ROC Says Oil Assets Too Expensive  

Small Australian oil producer ROC Oil has (for whatever reason) consistently talked about current oil prices being unsustainable and used very conservative estimates when determining project feasibility. Their CEO is now saying oil company share prices are too high (always an annoying thing for existing investors who are quite happy to see prices continue to surge upwards).

Despite a recent pick up in merger activity, ROC Oil Co. believes that mid-sized Australian oil producers are too expensive to get on the radar screens of cash-rich overseas rivals.

"None of the Australian oil assets are attractive to the U.S. and U.K. energy companies," ROC chief executive John Doran told Dow Jones Newswires in an interview. "The exception may be Australian companies with overseas interests, although there are not many undervalued situations," he said.

Besides their interest in the soon to be productive offshore Mauritanian fields ROC also has an interest in a field offshore WA that is about to be drilled and is touted as having the potential to contain 1 billion barrels (which would make it one of the largest finds this century if true). I for one will be a happy man if it does turn out to be the case.

As energy prices soar, Australia's Tap Oil Ltd. said Tuesday that its Jacala wildcat prospect offshore Western Australia may contain more than one billion barrels of oil. Jacala-1, in the deep water part of the Carnarvon Basin, is scheduled to be drilled in October by operator BHP Billiton, Tap said in a presentation to a UBS resources conference.

"It is a high risk prospect, but every oil well is risky," Tap managing director Paul Underwood told Dow Jones Newswires after the presentation. If the well succeeds, it could increase the worth of Tap "10 times", Underwood said in an interview, adding that Jacala's oil size potential was calculated by BHP.

In its presentation, Tap said Jacala is one of three "monster" exploration wells to be drilled this year and early next, also citing the Marley-1 well off the Western Australian coast and the Barque-1 well off the coast of New Zealand's South Island.

It said the target in the Barque prospect is five trillion to six trillion cubic feet of gas and about 500 million barrels of condensate. The company didn't provide estimates for Marley-1. BHP owns 55% of Jacala, Tap 25%, and Roc Oil 20%.