Oil group seeks partner for investment

Rockhopper executives said that seven or eight companies were interested in bidding, according to investment bank Morgan Stanley.

A research note from the bank also said the UK-based company could give up its lead role in the Sea Lion field it believes could have 1.3 billion barrels of oil in place.

“Rockhopper would be willing to relinquish operatorship, if the farm-down interest was high enough,” said the note.

The executives said Rockhopper was giving would-be bidders access to its data because it needs money and expertise to fund the development in an area that is the subject of a territorial dispute between Britain and Argentina.

Mark Wilson, oil analyst at investment bank Macquarie said in a research note he expected the company to sell a 50 per cent stake in its interests in return for the partner bearing all the cost of developing the project.

This limits the list of potential acquirers to well-funded companies, ideally with strong cash flows from production.

Analysts from Bank of America Merrill Lynch said Rockhopper was likely to see strong interest in the stake.

“The significant exploration upside potential that the acreage still offers could prove a strong ‘pull factor’ for bidders – particularly those with limited exploration newsflow,” they said in a note yesterday.