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magazineMore to come from Touchstone despite doubling in price since the summer
Touchstone Exploration (TXP:AIM) 101.4p
Gain to date: 95%
Original entry point: Buy at 52p, 25 June 2020
Our faith in small cap oil play Touchstone Exploration (TXP:AIM) continues to be rewarded in stunning fashion as the company announces the latest in a series of positive updates.
Touchstone has made another gas discovery on its Ortoire block onshore Trinidad, its third in succession, with the results of the Chinook-1 well exceeding pre-drill expectations.
FinnCap analyst Jonathan Wright comments: ‘This not only de-risks the upcoming Cascadura Deep and Royston prospects but also opens up significant follow-on exploration opportunities.
‘Touchstone has already identified 21 additional prospects on the Ortoire block representing five years of drilling inventory, for which we currently give zero value…this story has legs!’
He adds that the company should find it straightforward to commercialise the gas as the state operator (National Gas Company of Trinidad and Tobago) is a willing buyer of all the gas it can find.
The resulting increase in production as natural gas assets are brought on stream should result in a ‘wall of cash’ according to Wright which can be used to fund the development of Touchstone’s assets, advance further exploration opportunities and potentially even pay a dividend.
SHARES SAYS: The shares have nearly doubled on our entry point but there looks to be further upside potential. Hang onto the stock.
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