|Chennai||Rs. 24470.00 (1.37%)|
|Mumbai||Rs. 24900.00 (0.97%)|
|Delhi||Rs. 24200.00 (1.26%)|
|Kolkata||Rs. 24160.00 (0%)|
|Kerala||Rs. 24000.00 (0.63%)|
|Bangalore||Rs. 23800.00 (0%)|
|Hyderabad||Rs. 24140.00 (1.17%)|
* Third-quarter net loss more than doubles to $93.7 mln
* Oil, natural gas revenue falls 38 pct to $46.5 mln
* Says India production will fall unless new fields are added
* Shares fall as much as 9 percent
Feb 14 (Reuters) - Canadian oil and gas producer Niko Resources Ltd said the sale price of gas from its wells in India may nearly double, offering a ray of hope as the company reported its seventh quarterly loss in a row on Thursday.
Shares of Niko, which had a market value of C$635 million as of Wednesday's close, fell as much as 9 percent to C$8.20 on the Toronto Stock Exchange.
The stock has lost 79 percent of its value in the past year as the company suffered a string of exploration disappointments and struggled with declining output from the D6 block off India's east coast.
Niko said the gas price was likely to rise to between $8 and $8.50 per million British thermal units (mmBtu) based on a pricing formula recommended by an Indian government panel.
The recommendation now goes to the Indian cabinet for consideration. In India, the federal government sets prices of gas produced in the country.
The current pricing regime expires in April 2014.
Calgary, Alberta-based Niko has a 10 percent working interest in the D6 block, which accounted for 61 percent of the company's sales in the third quarter.
India's Reliance Industries Ltd owns a 60 percent interest and is the operator of the field, while BP Plc holds the rest.
"The comments on the gas prices are pretty consistent with broad commentary coming out of India," said analyst Nathan Piper of RBC Capital Markets.
"It needs to be confirmed by the government. So there is that final hurdle. However, a year ago ... different parts of the Indian government were disagreeing on the price. There is a lot more agreement now," Piper said.
The government gas pricing panel, headed by C. Rangarajan, a key adviser to the Indian prime minister, recommended a pricing mechanism for domestic gas production based on the average of the import price for liquefied natural gas into India and a volume-weighted average of gas prices in North America, Europe and Japan.
Niko, however, said falling production in the D6 block in the Krishna Godavari basin would erode the effect of a higher price, unless new supplies come on line. The company has identified three additional areas in the D6 block for potential development.
"Niko is a high-impact explorer in Indonesia and it is really news from Indonesia that will change Niko's share price," RBC's Piper said.
The company, which has working interests in 22 offshore exploration blocks in Indonesia, has abandoned wells in the country after they came up dry.
It also abandoned wells in Trinidad and cut its production forecast due to mechanical issues at a block in Bangladesh.
Niko's net loss doubled to $93.7 million, or $1.64 per share, in the October-December quarter from $40.4 million, or 78 cents per share, a year earlier.
Niko's global quarterly production of 145 million cubic feet equivalent per day was 34 percent lower compared to a year earlier.
The company's oil and natural gas revenue fell 38 percent to $46.5 million in the quarter, mainly due to production declines and greater-than-anticipated presence of water in the D6 Block.