Will the Cairn share price beat Premier Oil, Tullow Oil and BP shares after update?

Does Cairn Energy PLC (LON:CNE) (CNE.L) offer more investment potential than Premier Oil PLC (LON:PMO) (PMO.L), Tullow Oil plc (LON:TLW) (TLW.L) and BP plc (LON:BP) (BP.L)?

Cairn Energy PLC
Cairn Energy PLC

The Cairn Energy (LON:CNE) (CNE.L) share price is marginally down today after it released a statement to coincide with its AGM. The update talks about the progress the company has made in the last year with its strategic objectives.

For instance, in Senegal it has confirmed the scale and potential of the SNE field, with 9 wells successfully drilled in 3 years. Cairn recommenced the third phase of drilling in January and has already drilled 3 successful wells this year.

The focus in the short run in Senegal will be on defining the scale and phasing of the overall SNE field development, including the balance between the number of drilling centres, type and number of wells and the subsea infrastructure.

In the UK North Sea, both the Catcher and Kraken developments are significantly below their original budgets. Both are on track to target first oil this year. Combined, they are expected to deliver approximately 25,000 barrels of oil per day, which should generate cash flow for reinvestment.

In the last 6 months, the Cairn share price is up 9%. That’s a better performance than other oil & gas stocks such as Premier Oil PLC (LON:PMO) (PMO.L), Tullow Oil plc (LON:TLW) (TLW.L) and BP plc (LON:BP) (BP.L). The Premier Oil share price is up 8%, Tullow Oil is 22% down and the BP share price has gained 5%.

In my view, Cairn Energy has a good strategy and seems to be moving in the right direction. However, I feel BP and Tullow Oil in particular may have more investment appeal on valuation grounds, while I’m also upbeat about the Premier Oil share price in the long run. With a lot of choice in the resources sector at the moment in my opinion, I think Cairn is probably a stock for my watchlist, rather than something I’d be keen to buy at this moment in time.

About Robert Stephens 3395 Articles
Robert Stephens is a CFA Charterholder and an Equity Analyst by trade. He is a passionate private investor who has been buying and selling shares for many years, owning a wide range of UK shares in the process. He has written for Citywire and The Motley Fool US and now runs his own business. To contact Robert, please email info@investomania.co.uk or use one of the other contact methods available on the 'Contact Us' page