O'Brien ups Sterling Energy stake

Denis O'Brien has increased his stake in British oil and gas exploration company Sterling Energy to 9.08 per cent.

Mr O'Brien spent about £1.5 million buying 15.6 million shares in Sterling on February 7th at just under 10 pence each. Details of the share buying were released in a stock market announcement by the company yesterday.

The Irish businessman is now Sterling's second-largest shareholder behind Amvescap, which owns more than 29 per cent of the business.

He previously held 8.13 per cent of the company.

Mr O'Brien began stake-building in Sterling last September, when he spent about £9.4 million buying a 6 per cent stake in the company.

He bolstered his position in November by spending an addition £5.6 million by buying shares at 14 pence each.

The Irishman now owns 27.3 million shares personally and 122.4 million through a company he controls called Baycliffe Ltd.

Sterling is listed on the Alternative Investment Market in London and has a market capitalisation of £159 million. Its share price has declined sharply in recent weeks, having begun the year trading just above 14 pence a share. This followed disappointing drilling results in Gabon, where the company "plugged and abandoned" its Tham-1 well last month.

Mr O'Brien is thought to be sitting on a paper loss on his investment in Sterling due to the recent slide in its share price.

Sterling's shares closed in London yesterday at 9.2 pence.

Formed in 2002, Sterling has assets in the Gulf of Mexico, onshore US, Gabon, Mauritania, Kurdistan and Madagascar.

The company, which earlier this month announced a boardroom shake-up, expects to publish full-year results in April.