During October, fund managers John Dodd and Richard Hulf added to their position in Norwegian oil company Det Norske Oljeselskap due to recent production upgrades of some of the firm’s oil fields.
“We expect further upgrades later in 2011 and this is one of our top 10 stocks,” they say. Det Norske Oljeselskap now accounts for 3.5% of the portfolio.
Dodd and Hulf also increased the portfolio’s weighting to Brazil by buying into OGX Petroleum to gain exposure to the offshore Campos basin.
In addition, the managers bought China National Offshore Oil Corporation, the fund’s first Chinese holding, and Santos, to access the Asian liquid natural gas market.
The fund also added to “undervalued” stocks such as Panoro, Exillon, Occidental and Premier Oil in expectation of an improving investment climate for oil and gas in the coming year.
October also saw the managers sell out of their remaining holdings in Coastal Energy, Lundin Petroleum and Beach Energy after hitting target prices.
Dodd and Hulf highlight Swedish independent oil and gas exploration and production company Lundin as performing “particularly well” during the month.
Lundin’s share price rose significantly on the recent announcement that the Aldous/Avaldsnes field contains between 1.2 to 2.6 billion barrels of recoverable oil, more than previously estimated.
The fund has also reduced its expose to Colombia, a strategy it intends to follow until local elections have been completed.
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