Casimir Capital kept its target rating on Antrim Energy(TSE:AEN) Wednesday, after the oil and gas company said a leakage was detected at the Cormorant Alpha platform - leading to a shut-in of production at Causeway and Cormorant East.
Antrim acquires, explores and produces oil and natural gas in various international locations, and is focused on the development of its UK North Sea assets, Causeway and Fyne.
The company said this morning that the platform and pipeline infrastructure running through the TAQA-operated Cormorant Alpha are currently shut-in due to a potential hydrocarbon leak in one leg.
This includes production from Antrim’s Causeway field and the recently tied-in Cormorant East field, which are both processed at the North Cormorant platform prior to being exported to Cormorant Alpha.
The source of hydrocarbons is still under investigation, although hydrocarbon levels within the leg appear to be small and none were released into the environment.
The Cormorant Alpha platform is a key platform for pumping oil from about 27 fields on the Brent pipeline to the Sullom Voe sales terminal, Casimir analyst Ryan Galloway notes.
"With Cormorant Alpha handling about 90,000 bbls/d (10% of UK production), we see the shut-down likely leading to higher Brent oil prices in the short term," he says.
The analyst kept his speculative buy rating and $1.15 target on Antrim until further clarity is received on the status of the platform.
"While the required shut-down is likely to impact cash flows in 2013, we maintain our target at this time until the length of the outage is better known."
Shares in Antrim were down 1.8% this afternoon, trading at 55 cents.
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