1947 Oil & Gas PLC (AIM:1947) begins trading on AIM today, with shares marked at a premium price and ambitions to lift production from its newly acquired US Gulf of America assets by around 50% over the next two years.
In its London IPO, the junior oil and gas raised roughly £30 million at 10p a share to help fund its US$65 million acquisition of Houston-based Renaissance Offshore. The deal gives 1947 an immediate production base of around 3,300 barrels of oil equivalent per day in the second half of 2026, more than 90% weighted towards oil.
Production is targeted to rise above 4,000 boe/d in 2027 and reach 5,000 boe/d in 2028.
House broker SP Angel reckons growth can come from relatively low-risk recompletions and proved undeveloped reserves within the existing portfolio, with future operating cash flow available to fund further development.
Renaissance owns interests in 11 shallow-water Gulf fields and has independently audited 1P reserves of 15.0 million boe and 2P reserves of 19.7 million boe. The latter carry a PV10 of US$346 million, compared with headline acquisition consideration of US$65 million.
The organic growth plan sits alongside a broader consolidation strategy. 1947 intends to acquire further mature, conventional oil-weighted assets around the Gulf and US Gulf Coast, targeting a fragmented production base where some operators are seeking exits or selling non-core portfolios.
Tim Duncan, 1947’s executive chair, said: “Through our initial acquisition of Renaissance, 1947 now has exposure to immediate cash flows and a foundation upon which to build and grow a company of scale. We look forward to providing further updates as we deliver against our strategic goals as a listed Company.”
SP Angel, which acts as 1947’s nomad, said the AIM listing should give the company both access to capital and listed shares that could potentially be used as consideration in future deals, as its analysts initiated coverage with a Buy recommendation, and a 15.5p price target, based on the core net asset value of 1947’s producing assets.
Source: proactiveinvestors.com