Northern Petroleum. Way under-value!

NOP are a strong buy tipped in the city by many!

I’ve been asked for an opinion on Northern Petroleum more times than I care to remember.

So at long last here it is

Northern petroleum have some excellent assets off the Italian coast with potentially, over half a billion  barrel resource. The news flow of late has been all very positive with upgrades from brokerages varying from 167p up to 240p depending on which brokerage or analyst one talks to Success with the Italian assets alone would be transformational for Northern and the above in-house sp targets would in all likelihood go out the window as upgrades would be hot on the heels of any further success. Their share capital is approx’ 92 million which is extremely small bearing in mind that NOP are a producing oil company with a variety of producing oil and gas assets in Spain Italy, UK andFrench Guyane. The company strategy of acquiring geopolitical low risk assets is certainly destined to pay off and in fact is! Here’s a snippet from GECR’S Flashnote of Jan 5th 2011.

“Not only has Northern an impressive track record in acquiring assets cheaply,
but it has also generated €40 million of trading profits from disposals of non-core interests.
Alongside the blue sky potential of Italy lies the strong growth in production in The Netherlands
which underpins the share price. The board has its sights firmly set on a target producing of 5,500 barrels of oil equivalent per day (boepd) by 2015. Northern has a firm platform for this with current production of 1200 boepd which is expected to climb to 2,250 boepd by early 2011. In September,
the Brakel field came on stream which is the third of six onshore oil and gas fields that Northern has brought into production. The Brakel field is part of the company’s first multi-field gas development which is expected to be completed early next year when the fourth field the Wijk en
Aalburg commences production. Once that has been achieved, Northern will be turning its attention on getting the Ottoland and Papekop oil fields to come on stream”

So as you can see Northerns prospects are very good indeed with a Board in place that have certainly performed outstandingly over the last 12 months! The share price looks set to double over the next year or so as further good news is released.  There is some sneaky institutional buying rumoured to be going on. A good solid investment.And one last pointer as to how Northern are perceived from within the oil industry. Very well indeed. Shell are PARTNERED with them in Italy! As the price of oil continues to rise  somewhere along the line the thought is that Shell could gobble them up!

A great investment for serious investors! Target 200p near term with a 300p potential as the Italian assets move ever closer decision on first spud!

Viva!

Daniel