Penny Shares Guide

Currently the UK’s leading coal mine methane producer, Alkane Energy was founded in 2006. It has had some troubles in as a company, but in recent years its business seen tremendous growth in a variety of sectors. In addition to designing, building and operating power power plants fuelled by methane gas, the company has established a significant market share in the methane extraction industry from a diverse set of sources. These sources include coal mine methane (CMM), biogas, conventional gas and landfills.

Coal Mine Methane

Abandoned coal mines are rich sources of methane gas. As experts with the complex tools and techniques used to extract methane from coal seams, Alkane Energy expects CMM to be one of its main sources of revenue growth in the medium to long term. Alkane Energy currently holds a 2% market share in coal mine methane extraction. This market is growing in size and scope.

Biogas

In 2010, Alkane Energy announced that it had begun development on its first biogas plant. Biogas plants utilise organic agricultural waste products to provide methane gas, which can then be fed through power plants to provide clean, reliable energy. By using a method known as anaerobic digestion, Alkane Energy will provide cheap energy to inhabitants of the Whitwell area in North Derbyshire. Biogas currently provides about 1% of Alkane’s total produced energy, but this is expected to grow as demand for biogas plants becomes greater throughout the UK, particularly in rural areas.

Alkane Energy has invested heavily in these two areas over the past several years and is only now beginning to see results on its balance sheet. The company is poised to take off in the Alternative Investment Markets, making it a very attractive investment for investors who want to take advantage of the growing demand for green energy.

AFC Energy was founded in 2006 to provide low-cost hydrogen alkaline fuel cells for industrial applications. Fuel cells have been used in the past to power a variety of technologies including submarines and spacecraft. By utilising modern manufacturing technologies, best practices and proprietary advances in waste management, AFC energy seeks to make fuel cells a viable method for powering more commonplace technologies such as clean energy and chemical production.

In 2007, AFC Energy signed a contract with the Indonesian government to become the excessive supplier/manufacturer of clean energy in the country. By 2009, AFC was one of the top-performing stocks on the AIM, and by 2010 the company had won a large fuel cell order from Centrica, one of the UK’s leading integrated energy providers. AFC has partnered with many different world-class companies including chemicals giant Akzo Nobel, industrial gas supplier Air Products and clean coal provider Linc Energy.

The company’s growth areas include supplementing and improving the efficiency of underground coal gasification (UCG), one of the most commonly used “clean coal” technologies. UCG utilises inefficient steam cycle technologies to produce energy directly from gasified coal. This produces waste hydrogen gas, which, when fed into AFC’s fuel cells, can offer free electricity.

AFC’s low-cost fuel cells are among the most efficient sources of power in the world, acquiring close to 70% electrical efficiency compared to around 33% efficiency for the standard internal combustion engine. They will save clean coal companies money and make them more effective at providing cheap, clean power.

Other target markets for AFC include any industrial supplier or provider with significant hydrogen gas waste by-products. If a company wastes hydrogen gas in significant quantities, AFC fuel cells can significantly improve production efficiency. By providing a method for saving money and producing cheap, clean energy, AFC is occupying a highly-sought niche for today’s eco-friendly, finance-tight business environment.

Faroe Petroleum Plc focuses on exploration, evaluation and development of oil and natural gas field opportunities in the Atlantic Margin, North Sea and Norway offshore regions.

Faroe Petroleum Plc was founded in December 2002, and its shares were admitted to trading on the Alternative Investment Market of the London Stock Exchange in June 2003. Since acquiring its first UK licence in 2004, Faroe has increased its portfolio from two licences near the Faroe Islands to one that includes holdings in the Faroes, UK West of Shetlands, Norway and the UK southern North Sea.

Major Assets

The Company works to develop and invest in a varied assortment of operated and non-operated properties, and holds a portfolio of exploration and appraisal assets in the Atlantic Margin, North Sea, Norwegian Sea and Barents Sea. The portfolio balances between higher risk/higher reward assets in the Atlantic Margin and deep water off Norway, lower risk/lower reward assets in the North Sea, and development and production holdings in offshore UK and North Sea areas.

Faroe Petroleum has partnered in joint ventures with companies such as BP, Chevron, DONG, Eni, E.ON, OMV, RWE, and Statoil.

Latest Developments

Faroe Petroleum announced in November, 2010 that an exploration well drilled in the Licence 005 area off the Faroe Islands had reached its full depth and had found “robust evidence of the presence of an active petroleum system.” Further analysis is under way. In addition, the company announced that drilling has begun on a new Lagavulin well in the Atlantic Margin area, located in an area with estimated reserve potential of more than 500 million barrels of oil equivalent. Lagavulin is one of the Atlantic Margin’s largest undrilled expanses. The well is expected to take around 120 days to complete.

In October, 2010, the company also announced that it was provisionally awarded 4 new licences in the West of Shetlands offshore area in the UK 26th Licencing Round, adding to its assets in an area where Faroe Petroleum is already active and knowledgeable.

The Company has offices in Aberdeen, U.K.; Stavanger, Norway and Torshavn, Faroe Islands.

Shares of Faroe Petroleum (FPM) are listed on the London Stock Exchange’s Alternative Investment Market and were at 172.25 p as of 29 October 2010.

Petro Matad Limited focuses on oil exploration, site development, and future production in Mongolia. The largest shareholder is Petrovis LLC, a Mongolian petroleum importer and distributor. Petro Matad is the first largely Mongolian-owned corporation to trade on any major international stock exhange, having been admitted to the Alternative Investments Market of the London Stock Exchange in 2008.

Major Assets

The principal asset of the group is a Production Sharing Contract (PSC) over Matad Block XX. This is a petroleum block covering 14,250 square kilometres in eastern Mongolia near the Chinese border. It is adjacent to Block XIX, which contains developed oil fields, and is believed to share part of that hydrocarbon system. The company has recently taken on additional PSCs on two other blocks (Block IV and Block V) covering another 71,000 square kilometres of central Mongolia.

Petro Matad has been exploring and surveying Block XX since 2006. They are advancing to the next stage of analysis on Block XX, while beginning early stage evaluation of Blocks IV and V.

The strategy of Petro Matad is to continue to explore and appraise Blocks XX, IV, and V while seeking further prospects and opportunities in the Mongolian oil sector. The company plans to keep an active interest in any commercially viable projects initiated in their PSC areas.

Strengths

The strengths of Petro Matad include the lower cost of onshore exploration and development. The topography of its major asset, Block XX, is flat and the Group has identified multiple leads and prospects in the area for next-stage exploration. The target resources are believed to be at relatively shallow depths. Proximity to China means a ready and easily reached market for any resources developed.

Shares of Petro Matad Ltd (MATD) are listed on the London Stock Exchange’s Alternative Investment Market and were at 136.00 p as of 29 October 2010.

Leni Gas and Oil Plc, based in London, is an international hydrocarbon exploration, development, and production company. The company holds assets in Spain, Trinidad, Malta and the US Gulf of Mexico. Leni Gas and Oil was incorporated in 2006 and trades on the Alternative Investment Market of the London Stock Exchange.

Corporate Strategy

The company’s strategy is to acquire proven reserves and enhance production in established fields, concentrating in low-risk countries. The directors have a wide variety of experience and expertise in the oil and natural gas fields, and are working to leverage their knowledge to identify investment opportunities in proven reserve areas as well as underexploited areas which can benefit from an injection of cutting-edge technology and techniques.

LGO Assets

Leni Gas and Oil holds interests ranging from 10 to 100 per cent in various projects in four main areas.

In the US Gulf of Mexico and Trinidad, LGO is partnered with other corporations in development of new oil and natural gas sites in the Gulf, as well as expanding the Icacos operation in Trinidad to reach deeper reserves.

In the area off Malta, LGO owns a 10% interest in an offshore site close to established hydrocarbron reserves. They are evaluating the area for future production.

In Spain, LGO owns 100% of the Ayoluengo oil field, which has been the largest site of Spanish oil production since the 1960s. LGO seeks to enhance current production with updated techniques, taking advantage of facilities already in place from previous operations.

Leni Gas and Oil suffered losses in 2009 related to its relinquishment of Hungarian assets which had proved unprofitable, but has stepped up development of its other assets and expects to accelerate production in its three currently-producing areas while continuing to develop the Malta holding.

Shares of Leni Gas and Oil Plc (LGO) are listed on the London Stock Exchange’s Alternative Investment Market and were at 3.29 p as of 29 October 2010.