Videocon Inds jumps after new oil & gas discovery in Brazilian offshore

Videocon Industries rose 11.79% to Rs 176.85 at 10:06 IST on BSE after the company said its consortium has hit upon oil at a third extension well in the ultra-deepwater Farfan area in Brazil's Sergipe basin.

The announcement was made during trading hours today, 3 February 2015. Shares of consortium partner Bharat Petroleum Corporation (BPCL) were flat at Rs 747.90.

Meanwhile, the BSE Sensex was up 17.20 points, or 0.06%, to 29,139.47.

On BSE, so far 7.05 lakh shares were traded in the counter, compared with an average volume of 1.20 lakh shares in the past one quarter.

The stock hit a high of Rs 182.40 and a low of Rs 159.75 so far during the day. The stock hit a 52-week high of Rs 211.05 on 10 June 2014. The stock hit a 52-week low of Rs 154.95 on 16 December 2014.

The stock had underperformed the market over the past one month till 30 January 2015, falling 1.86% compared with 6.49% rise in the Sensex. The scrip had also underperformed the market in past one quarter, sliding 3.80% as against Sensex's 6.72% rise.

The mid-cap company has an equity capital of Rs 318.77 crore. Face value per share is Rs 10.

Videocon Industries said that Petroleo Brasileiro SA (Petrobras), the operator of the BM-SEAL-11 concession (the Concession) announced on 2 February 2015, the drilling results of the third appraisal well 3-SES-186 (3-BRSA-1286-SES), located 103 km from the city of Aracaju and about 10 km from the discovery well Farfan, in the Concession Area BM-SEAL-11, Block SEAL-M-426 in deepwater Sergipe Alagoas Basin.

The result obtained in this well confirms the extension of the light oil reservoirs previously discovered by the Farfan discovery well in turbidite sandstones of Upper Campanian age (Calumbi Formation), communicated to stock exchange on 12 August 2013. In addition, the well found presence of a new light oil accumulation with a total thickness of 68 meters in shallower reservoirs. This accumulation is part of the Sergipe-Alagoas Basin ultra-deep water exploratory project, as provided for in the 2014-2018 Business and Management Plan, the company said in a statement.

The Well 3-SES-186 is currently under further drilling to the target depth of 6060 meters, at water depth of 2,467 meters.

The consortium partners will continue implementation of the Discovery Assessment Plan as approved by the Brazilian regulatory authority, Agencia Nacional Do Petroleo, Gas Natural e Biocombustiveis. Petrobras holds 60% Participating Interest in the Concession and IBV Brazil (a Brazilian joint venture company equally held by Videocon Energy Brazil, a wholly owned overseas subsidiary of Videocon, and BPRL Ventures N.V., a wholly-owned subsidiary of BPCL) holds the remaining 40% participating interest in the concession. The consortium will carry on operations in the area to further confirm the extent of the hydrocarbons inplace and the characteristics of the reservoirconditions encountered, the company said.

Videocon Industries had reported 93.35% slide in net profit to Rs 1.34 crore on 1.4% rise in total income to Rs 3407.86 crore in quarter ended September 2014 over quarter ended September 2013. The current accounting year of the company has been extended by a period of six months. As such the current accounting year shall be of 18 months ending 31 December 2014.

Videocon Industries offers range of products in televisions, washing machines, air-conditioners, refrigerators, audio products, home theatre systems and microwave ovens. The company operates in four segments: Consumer Electronics and Home Appliances, Crude Oil and Natural Gas, Telecommunications, and Power.

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