THE SUNDAY TELEGRAPH (UK): Bidders balk at First Calgary price tag: “Ten of the world's largest energy groups, including Shell and Total, are studying information about First Calgary ahead of a mid-April deadline to submit binding offers.” (ShellNews.net) 27 March 05

By Sylvia Pfeifer (Filed: 27/03/2005)

Bidders for First Calgary, the oil and gas exploration company that put itself up for sale for £1.7bn late last year, have raised concerns about the steep price tag. 

Ten of the world's largest energy groups, including Shell and Total, are studying information about First Calgary ahead of a mid-April deadline to submit binding offers.

The sale had been billed as this year's largest oil and gas deal but it is understood that several of the potential bidders have been disappointed by details of the reservoir.

"There does appear to be a lot of gas there, but it could be difficult to get out," said one executive. "The company may well be sold for less than half its market capitalisation."

First Calgary has estimated reserves of 13.5 trillion cubic feet equivalent of natural gas. Its major asset is a massive natural gas field in on-shore Algeria. The field has attracted the attention of Europe's leading oil and gas groups because of its proximity to western Europe, which is anxious to tap into new gas fields.

Since it floated on the Alternative Investment Market (Aim) just over two years ago, First Calgary's shares have soared from below 200p to 935p.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2005/03/27/cncalg27.xml 

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