Providence Resources’ target price upgraded 50% by private bank
Mirabaud upgrades price target to 50p per share from 33p per share
An oil rig at Provdence’s Barryroe prospect. Photograph: Finbarr O’Rourke
Private bank Mirabaud has upgraded its price target on Irish oil and gas explorer Providence Resources by more than 50 per cent after the company amended an agreement to sell a stake in its flagship Barryroe prospect.
Providence said last month that it had finalised an agreement with Chinese explorer Apec in respect of a farm-out agreement for its Barryroe site, a move Mirabaud sees as a “major step towards commercialising” the oil field.
Assuming a discovery is made, Mirabaud valued Providence’s stake at over $1.3 billion (€1.12 bn).
“We consider the company to be in an almost unique position, offering deep value but with a clear roadmap to commercialisation,” analysts James Midgley and Tim Hurst-Brown wrote in a note to clients.
The private bank is not considered an independent commentator on Providence because it is currently engaged by the oil explorer to provide corporate finance services.