CANADIAN oil explorer WesternZagros Resources is considering a London listing in a bid to increase the valuation of its oil and gas assets.
The board of the Calgary-based company, which has assets in the Kurdistan region of northern Iraq, is in discussions over whether to have a dual listing and whether the company would need to raise capital.
WesternZagros, which is currently listed on Toronto’s Venture bourse – the equivalent of London’s Alternative Investment Market – is following the lead of other Kurdistan-focused explorers looking to London for improved valuations.
A spokesman told City A.M.: “The trend is to come to London. It’s the home of metals, miners, oil and gas and with the geopolitical challenges in Kurdistan, there is seen to be greater support in London.
“London has listings for Genel and Gulf Keystone and the Norwegian company DNO, which also has oil in the Kurdistan region, is talking about coming to London too.”
The discussion comes amid a long-running debate over who should control Kurdistan’s oil exports.
Kurdistan said last week it expects to start exporting its crude oil production along a new pipeline to the Turkish border by August 2013. That defies Baghdad, which says only the central government’s oil authorities have the right to control oil exports.
The Kurdistan region, which has its own government and army, has already clashed with Iraq’s central government and halted its oil exports last month after accusing Baghdad of not remitting payments due.
WesternZagros’s chief executive Simon Hatfield conceded that the politics of exporting from the country are difficult, but believes company could sell its output at slightly less than $60 a barrel on the local market until it can thrash out a permanent export route.
He said a London listing would help tackle the “huge valuation difference” in gauging the worth of Kurdistan assets between Toronto and London, which has “more awareness and tolerance of risk”.
Last week the company reported a quarterly loss of $2m (£1.3m).