Just cannot understand recent SP volatility!

As a Dana shareholder I find it difficult to
find any reason to sell, even at current price. The Company has recently
entered a number of agreements which will have
considerable benefits:-

1. Reserves from 31st December 2003 of 123.7 mmboe
must now be in the region of 200.0 mmboe.( 100 million
North Sea 70 million Mauritana 30 million Russia ).

2. Production will rise to 25-27 thousand boepd in
2005 from 18 thousand in 2004.

3. At 30th June 2004 a Net cash position which will
have been enhanced significantly year to date.

4. Exciting exploration potential.

5. Management that seem to know what they are doing
with an excellent chief executive.

6. Recent deals by other oil companies have seen oil
assets bought at prices between 7-11 dollars a barrel
( see last weeks Investors Chronicle ) Dana must have
a value well in excess of the current 300 million.

I am holding firm and looking towards 800 pence.

Any other views out there?

The rise at 11.30 ish was solely due to a rumour that BP were possibly considering a bid of 1700p. The rumour was purely market gossip and flagged as such.

from a chart point of view, sp has jumped back up through 200 dma ..... also, traffic today is certainly heavy for this company

Don't forget though that the recent drilling news from Norway is disappointing:
""The primary exploration target for these two wells was to prove the presence of petroleum in Paleocene age reservoir rocks. Oil was proven in both wells, but with less reservoir thickness than prognosed. Extensive data has been gathered in the reservoir zones, including pressure tests and oil samples. Given the close proximity of the Jetta oil discovery to existing oil producing infrastructure, further work needs to be carried out to evaluate the commerciality of the Jetta accumulation in conjunction with other fields."

Apart from the t/o rumour, I would not be confident investing here atm.

true, but i am now in a luxury cleft stick insofar as i bought some this morning out of greed and am now wondering if/when to bank the profit!

Mixed news from DNX today:
http://moneyam.uk-wire.com/cgi-bin/articles/201006240716471671O.html

Summary of above RNS:
StockMarketWire.com
Dana Petroleum has revealed two new oil discoveries in Egypt and given an update on its 2010 drilling programme.

Dana said the first success was an exploration well in the North Zeit Bay production sharing contract area, onshore Gulf of Suez in Egypt, where Dana holds a 100% interest.

The Dana operated Lorcan-1x well was drilled to a total depth of 7,500 feet, encountering good quality oil bearing sands in the Kareem formation in line with Dana's prognosis prior to drilling.

During the drill stem test, the well flowed strongly with high downhole pressures delivering flow rates of up to 4,714 barrels of oil per day.

Dana also reports the successful drilling and testing of the Fayoum-2x well in the East Beni Suef concession, onshore Egypt (Dana 50%).

Oil was discovered in the Upper Bahariya formation, with net pay of 64 feet, and in the A/R G-20 sands, with net pay of 10 feet.

Test data indicates that the well should be capable of flowing at oil rates of approximately 600 boepd.

Elsewhere in Egypt, drilling operations have now been completed on the Bamboo well, offshore Nile Delta (Dana 50%) having reached the planned TD of approximately 12,533 feet.

Significant good quality sands were encountered in the primary target, however petrophysical interpretation of the logs acquired across the reservoir interval indicates that these sands are water bearing.

And drilling operations have also been completed on the Monkwell well, 42/29a-10, in the UK Southern North Sea, having reached planned TD of 9,473 feet.

The target Lower Leman Sandstone reservoir was encountered some 200 feet deep to prognosis.

Therefore the sand came in below the area's gas-water contact.

This result indicates that the Monkwell gas discovery is too small to be economic.

The rig will now move to the Tolmount location and this Eon-Ruhrgas operated well is expected to spud shortly. "

Note from FT sector watcher today:
"DNX announced post market close that it has received a very preliminary approach which may or may not lead to an offer for the Company. So theres no guarantee of an offer and no indication of who the potential bidder may be, although the FT speculated that it might be the Korean state oil co, KNOC, and indeed went further to suggest a possible bid premium of 40% to yesterdays opening price
This certainly doesnt sound like a done deal, and indeed as an unsolicited approach, it may struggle to gain management support, mainly because the CEO Tom Cross has a very optimistic idea of what his company is worth. Given that TC has paid himself better than any other mid/large cap CEO over the past 3 years, despite a lacklustre share price performance, its probably a fair bet that hell be after a big price, which we would imagine even a state oil co with deep pockets will baulk at. And when it comes down to it, were not even convinced that the companys core NAV is much more than 1100-1200p/share. This bid could easily therefore evaporate quickly and wed be tempted to sell into strength today."

Anyone got any idea about how the KNOC indicative offer of 18 for Dana will play out please?

if this is fair price, then i'ld be inclined to sell in the market now, the 100p discount taking into account any lingering uncertainty + time element - as i note harry posted above

Carsie. some say DNX will reject 18, in which case KNOC may walk away. Others say KNOC or another may offer 20, but that seems to be the max value attributable to DNX. The fact that DNX's reaction is almost impossible to guage & that their assets are very hard to value has the brokers worried that the whole thing will fall flat, hence the advice to lock in any profit you have. If the sp reaches anywhere near 18, I would be inclined to get out & move on.

Thanks Cynic and Harrycat. Your advice appreciated.

Just to give a summary of what's in this w/e FT, KNOC has tabled a 18/share offer on condition it can carry out due diligence on DNX assets. However it appears that KNOC have inserted a few pre-conditions which are not acceptable to DNX, one of which is that DNX does not solicit for any other offers. It also appears there is a clash of personalities with each saying that the other is refusing to agree on a meeting. The last point is that there may be some doubt as to how KNOC are going to finance the deal as far as DNX are concerned, though KNOC seem to be confident that, as South Korea's national oil company, that particular question is not in doubt. Evo securities say maybe 10 if the deal falls through.

sell quick looks to be order of the day, even if sp tumbles somewhat on monday

certainly will be looking to sell mine I think. Tempting to stay in case of another suitor joining the fray, but i'd rather have the money invested elsewhere after the recent gains.

first thought prudent; second thought dumb

Nothing wrong with taking money off the table, bid or no bid, Anne-Marie drilling commenced which "could" change the outlook.

With the lastest discovery in Egypt, glad I haven't yet sold up. Looks like easily recoverable oil and within a short location of last find, commercially viable.

They can discover an "oil eldorado" but in a bid situation : it won't make much difference.

anyone think its worth shorting dana on the offchance the deal doesnt go ahead?