David Baddiel, Angus Deayton and F1 family all plough into Fastnet
A glittering swarm of celebrities are hoping Fastnet Exploration's boss can bring in a gusher, writes Roisin Burke
Published 17/02/2013 | 04:00
Famous shareholders like comedians David Baddiel and Angus Deayton, and Formula One magnate Bernie Ecclestone's ex Slavica, will be watching as Irish explorer Fastnet gears up to drill this year.
Key to that is Carole Law, the company's exploration director, whose job it is to hook in big oil and gas player partners with finance to make things happen.
The listed minnow has attracted many well-known figures. British music retail tycoon Julian Richer has shares. Ex-Merrion executive and Central Bank stockbroking watchdog Michael Hodson and hedge funder and former Merrion boss Adrian O'Carroll are investors. One of the oldest banks in the world, Benedict Hentsch, where Napoleon was a customer in his day, has stock, as does ancient City of London merchant banker Rathbones.
Just back from selling the Fastnet story to London investors and on a flying visit to Dublin (she's based in the US oil and gas heartland of Houston, Texas), Law is relishing the beauty of small oil. "I'll never go back to a big company, this is the kind of opportunity that I want to be part of," she says.
A well-connected industry networker, she was exploration chief for giant explorer Anadarko's vast Africa operations. She worked some of the world's biggest oil and gas finds, not least the 1bn barrel Jubilee field and the major gas frontier of the Rovuma Basin in Mozambique.
Yet she has thrown in her lot with a relatively tiny Irish outfit betting on early stage prospects where both risk and reward potential are high.
There is precedent, which is perhaps what has lured in so many high-profile shareholder names. Law has worked for Cove Energy, the upstart that scored big in Mozambique then sold for €1.5bn. It was a mega win for hundreds of Irish shareholders, some having bought in for as little as 10c a share, bagging a windfall on the €2.77 a share deal.
Law advised Cove both on exploration and ahead of its sale and also worked with former Cove boss John Craven.
With market cap of €77m, Fastnet was started by Craven and other key Cove people, plus seasoned financier Cathal Friel, who has a €8m stake. Seven months after floating, share price has doubled.
Still, its strategy is risky and racy: get in early on unproven assets, partner with bigger players and get them to carry the drilling costs, and monetise as early as possible, is the theory.
Law certainly fancies Fastnet's chances. Before she was recruited by Craven et al, she had already run the rule over Celtic Sea acreage for another firm and was "intrigued" by what Fastnet had put together there. "I think there's some interesting-looking stuff," she says. "The industry is definitely watching."
She was also familiar with the company's Morocco asset and "liked the play there".
Big independent explorer Kosmos obviously agrees, as it's putting some of its €500m spend on operations this year into partnering with Fastnet to drill a well in Morocco, ideally before the year is out. The bigger partner will take on most of the circa €100m drill cost. Law's close relationship with Kosmos is crucial.
In Ireland Fastnet has two 'wildcat' (that is, unproven) exploration options: the Molly and the Mizen blocks. It also has two licences where substantial oil and gas was discovered in the Eighties – but it was unviable to drill. Now changes both in prices and technology mean they should be deliverable.
One of them – 49/13 – is expected to yield possibly 500m barrels of crude oil starting in 2014.
A €20m 3D seismic testing, which Law helped raise finance for, to be carried out this summer, will tell more about the asset value. "That will firm things up for us in terms of bringing in a major player," says Law.
It may even attract an Exxon-calibre operator.
"With Exxon getting ready to drill a well over in the Porcupine Basin [off the south west coast of Ireland] the majors are, I'm sure, saying, 'Offshore Ireland, maybe we should be looking there' – there's a sort of a following mentality that tends to run in this business," she says.
In Morocco two big recent deals, one by Chevron and one by Tangiers Petroleum, have knock-on cachet for Fastnet. "It substantiates the idea that we're in the right places," she says.
As for future buys, Law won't deny that if the company saw the right prospect it would go after it.
"If you wait until you need an opportunity, it seems like you don't find it, so you've got to be looking," she says. "And if you see something that's valuable, you have to be poised to execute on it."