The BPH Energy Ltd (ASX: BPH) share price continues to do its dance of speculation. Up and down, the volatility persists, as it has since late January. The culprit appears to be the contest over whether a drilling program will go ahead.
Shares closed the day at 16.5 cents, down 24%.
Why is the BPH Energy share price falling?
The story so far
On 1 February BPH Energy announced its proposal to use the Sydney Basin drilling program to investigate the potential for a carbon capture and storage (CCS) project. The company proceeded to conduct a capital raise to fund the proposed project.
However, the party was crashed when NSW Deputy Premier John Barilaro stated he would refuse applications to extend the PEP11 oil project. This put BPH in a precarious position after already raising capital. The issue is PEP11 encompasses the area where BPH would deploy its CCS project.
BPH Energy clarified to shareholders that the project was subject to both state and federal government approval. Additionally, in the situation where federal and state levels are not in agreeance, the federal decision wins out.
Due to the erratic price and volume movements, BPH Energy received an ASX Price/Volume Query yesterday. Today’s announcement addresses the queries made by the ASX.
Price query response
The company outlined its recent updates to the market that may have had an influence on the share price. Furthermore, the company noted there have been several media statements by the Joint Authority members, which includes the Federal Government Minister for Resources and the respective NSW Minister.
BPH Energy highlighted comments made by the Federal Minister Senator Hon. Keith Pitt MP on 12 February 2021, who stated that “A decision on Petroleum Exploration Permit 11 off the New South Wales coast” would not be delivered on that day and also indicated his “preference for the decision on the permit extension to be made soon.”
In addition, Senator Pitt noted that detailed consideration would be given to the approval. This comment suggests there is potential the project may still be turned down.
The BPH Energy share price dropped by as much as 30% in intraday trade in response and closed the day down 24% at 16.5 cents.
Where to invest $1,000 right now
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of February 15th 2021
More reading
- Why BPH Energy (ASX:BPH) shares are now in a trading halt
- Why the BPH Energy (ASX:BPH) share price is crashing 21% lower today
- Why the BPH Energy (ASX:BPH) share price rocketed 32% higher today
- BHP Energy and Zip were among the most traded ASX shares last week
- Why BPH Energy (ASX:BPH) shares are in a trading halt
Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
The post Why did the BPH Energy (ASX:BPH) share price tank 24% today? appeared first on The Motley Fool Australia.
from The Motley Fool Australia https://ift.tt/3s9a4IB
Leave a Reply