Green light for fracking pushes up IGas by 15pc

ENERGY firms caught traders’ attention yesterday as the Government threw its weight behind the British shale revolution.

Communities Secretary Sajid Javid gave Cuadrilla approval to frack at its site in Preston New Road, Lancashire. The controversial technique might not be loved by campaigners, who fear it can cause earthquakes, but it was music to the ears of investors.

Although Cuadrilla is a private company without a stock market listing, dealers saw the approval as a licence to drill down into the sector themselves.

Their enthusiasm pushed shares in onshore exploration firm IGas

Energy up 14.6pc, or 1.75p to 13.75p. Listed on the AIM junior stock market, the firm is one of a relatively small number that give traders exposure to onshore drilling.

IGas has 55 licences at locations across Britain, but like many rivals, its progress has so far been impeded by protests.

There was good news too in the wider sector, as Tullow Oil pumped up 4.6pc, or 11.9p to 273.7p after a positive note from Barclays. Analysts hiked their target price from 310p to 340p, saying Tullow’s South Lokichar discoveries in Kenya were worth more than they previously thought.

The firm would benefit from steadily improving oil prices, they said, with Brent Crude hovering above $50 a barrel after a sustained recovery.

Fossil fuel big beast BP was also buoyed by the positive mood, climbing 0.3pc, or 1.5p to 473.5p.

But not all firms were lifted by the tide of good will.

AIM-listed President Energy crashed 34.4pc, or 3.96p to 7.54p after being forced to suspend operations in Salta Province, Argentina, following a catalogue of failings. The firm said it was ‘extremely unusual to encounter such a combination of issues in the course of a single well’ and promised an investigation.

With a lacklustre day for the blue chip FTSE 100 index, traders were looking elsewhere for opportunities. The Footsie struggled to gain direction, eventually closing down 0.47pc, or 33.29 points at 6999.96.

One of the few to do well was travel firm TUI, helped by the weak pound. Shares rose 1.35pc, or 15p to 1129p.

But there was plenty of activity at the smaller end of the market with two pharmaceutical firms facing different fortunes.

FTSE 250 firm BTG rose 5.7pc, or 37p to 684p after announcing double-digit turnover growth in the six months to September 30. The firm, which works on critical care, cancer and varicose vein products, said revenue would be ahead of its previous guidance of £510m to £540m.

It also reached a £28.5m settlement with the US authorities over the marketing of cancer drug LC Bead. BTG said the probe dated from before it owned the product.

Summit Therapeutics suffered a sharp sell-off as investors’ enthusiasm for the drug maker waned. Summit’s share price almost doubled in a single day earlier this week after it revealed it was teaming up with US rival Sarepta Therapeutics to develop and market a specialist drug in Europe.

The licence allows the AIM-listed company to sell an experimental treatment for muscle wasting disease Duchenne muscular dystrophy.

But shares dropped 14.7pc, or 34p to 197.5p yesterday, suggesting traders felt their initial enthusiasm might have been overdone.

In the financial sector, fund manager Liontrust unveiled a 19pc increase in assets under management to £5.7bn. The firm said it had £92m of net inflows in the six months to September 30. Its update met a muted response and shares closed flat at 330p.

Games Workshop had more luck after issuing a 3pm trading update, which gave shares a late boost.

The tabletop gaming business said sales and profits in the last four months were ahead of expectations – helped in part by the weaker pound.

Share rose 6.7pc, or 34.5p to 548.5p.