Investors get excited over oil stocks as North-east firm snatches the limelight

Xcite, led by Rupert Cole, has become an investors' magnet
Xcite, led by Rupert Cole, has become an investors' magnet
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XCITE Energy, the Aberdeen-based oil company, has cemented itself as one of the most-popular stocks among private traders after vying for the top spot in a list of the most bought and sold shares during 2012.

The Aim-quoted firm, which was set up to develop the massive Bentley heavy oil field in the North Sea, was the second most bought, sold and talked about small-cap stock, according to a league table compiled by stockbroker Interactive Investors.

Xcite, which is run by chief executive Rupert Cole and chairman Roger Ramshaw, was only beaten to the top spot by Gulf Keystone Petroleum, the much-larger Iraq-focused driller.

Douglas Boyce, head of share dealing services at Interactive Investor, told The Scotsman: “Xcite Energy sits in that same bracket as many small cap resource stocks – the potential is there for big moves higher as projects are reported to be coming good – and of course the scope for price reversions when the hype doesn’t match reality.

“We saw that this year with a couple of big jumps where the share price added in excess of 50 per cent in a matter of days and although on both 
occasions this was followed by a similar reversion, many will be well aware that the share price came close to touching 400p at the end of 2010.

“Plenty of investors will flock to these stocks, even if they can just make a modest profit on the runs higher.”

In June, Xcite unveiled its long-awaited banking deal, worth $155 million (£100m), to fund the next stage of the development of its Bentley field.

Five lenders agreed to a five-year loan, on top of a deal that was already in place with BP to market the oil from the field and provide up to $40m in working capital in the development stages and $5m in financing.

In September, BP sold 135,000 barrels of oil on behalf of Xcite at a price that was less than 12 per cent lower than the cost of Brent crude, a much higher rate than the company had expected.

Among the blue-chips, Tesco was the most-bought stock, while Lloyds Banking Group was the most-sold.

Rebecca O’Keeffe, head of investments at Interactive Investor, said: “Tesco was a short-term traders dream throughout 2012. Rallying nearly 10 per cent in the first two weeks of the New Year, the share price collapsed in mid January on a dire Christmas trading statement – definitely wasn’t one for the buy and hold investors.

“Banks had a bumper 2012, with Lloyds topping the sector and nearly doubling in value over the year.”