KBC Peel Hunt Ltd

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Recommendation Recent Mkt Cap.

Company Sector Comment Forecasts Old New Price (£m)
Oilexco (OIL) Oil & Gas Blackhorse Well No Change BUY BUY 186p 290

Oilexco (OIL) – Blackhorse well– FCAST: No Change, REC: BUY

Oilexco’s Blackhorse well appears to have intersected at least 80 feet of gross hydrocarbon bearing pay in Jurassic
aged sandstones. The questions are: how much of this is oil, how much gas? What are the flow rates? The answers
should be known in three weeks when the tests on the well are concluded. It should be a pretty good bet that the
prospect has come in – at least as well as could have been expected before drilling. To recap, Blackhorse was an old
discovery with about 12 million barrels of probable reserves. Oilexco has earned a 40% interest in the field by paying a
60% share of the costs of an appraisal well to test an extension of the field to around 60 million barrels. At the upper
end, the prospect should be worth about 50p per share to Oilexco, taking the NAV to 250p per share. The risks of
disappointment, while not eliminated, are significantly reduced.
Research Analyst - Tony Alves +44 (0)20 7418 8813

Regulatory disclosures and Disclaimer

Recommendation structure, and distribution*
N
Buy > +20% expected absolute price performance over 12 months
Add +10% to +20% expected absolute price performance over 12 months
Hold +/-10% range expected absolute price performance over 12 months
Reduce -10% to -20% expected absolute price performance over 12 months
Sell > -20% expected absolute price performance over 12 months
Corporate #

*Distribution during period 1 July 2005 to 30 September 2005

# KBC Peel Hunt Ltd is committed to providing objective investment research, however KBC Peel Hunt Ltd is broker and/or nominated adviser to, or
is retained by, this company and is therefore unlikely to be perceived as objective. This research should therefore be considered as non-objective
research.
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Please note that the share price used in the headline is the mid-market price taken at the close of trading the previous trading day.

Additional Disclosure for Oilexco:

KBC Peel Hunt Ltd makes a market in this company.

Recommendation History
Buy 01-Jul-05
Hold 05-Apr-05
Buy 26-Aug-04