Dutton Associates updated its coverage of Century Petroleum, maintaining a Speculative Buy rating and a 12-month $1.30 price target. The research note dated 1/10/2008 by Dutton senior analyst Richard R. Wolfe, CFA, is available at www.jmdutton.com, and at First Call, Bloomberg, Reuters, Zacks, Knobias, and other financial portals.
Century Petroleum announced first sales of natural gas and condensate from the discovery well at its Shadyside Farm prospect in St. Mary's Parish, Louisiana, where it holds a 15.17% working interest (up from 8.92% as of our August 2007 report). The company reported daily production rates of 1.6 MMcf natural gas and 136 barrels of condensate with further upside potential depending on reservoir performance. We believe that the company's results at Shadyside are a positive demonstration of management's judgment in terms of prospect risk assessment as well as its technical capabilities. Progress continues with regard to the company's other prospects. The Thunder Stud prospect (Calcasieu Parish, Louisiana) has been production tested at its deep pay (approx. 17,900 ft) and been confirmed as a discovery, flowing at daily rates of approximately 500 barrels and 1.1 MMcf. The Alligator Bayou prospect (Matagorda and Brazoria Counties, Texas), the company's largest in terms of estimated resource size, is still expected to spud in the second quarter of the 2008 calendar year.
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