The Oil Search Limited (ASX: OSH) share price is up 2% thanks to two potential reasons.
Oil Search was established in Papua New Guinea (PNG) in 1929, where it operates all of the country’s producing oil fields, it holds an appraisal and exploration portfolio and has a 29% interest in the PNG LNG Project.
Why Oil Search may be 2% higher
Earlier today, Oil Search announced that it has expanded its lease position further in the Alaskan North Slope.
It has exercised its right to acquire and operate a 50% interest in 120 leases covering 195,000 acres in the eastern area of the Alaska North Slope.
The cost will be approximately US$8 million for the leases, which works out to be approximately US$82 per acre. The company expects the leases will be formally awarded by the State in mid-2019.
Oil Search Managing Director Peter Botton said:
“The potential of this new area is very exciting and, as Operator, we intend to explore it systematically. The forward programme will reprocessing of existing seismic data and the acquisition of a new 3D survey.”
Oil Search may also have risen higher today with the WTI Crude Oil price rising 1.3% according to Bloomberg.
This is a positive update by Oil Search, but resource businesses are too dependent on the commodity price for my liking. They have very little control over pricing. That’s why I prefer businesses that can keep growing profit, like the ones mentioned in the free report below.
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