Drilling costs, the drop in oil prices and an exchange loss on dollar loans pushed Tuskar Resources deeper in to the red last year.

The group has reported losses of During the 12-month period Tuskar incurred substantial costs on drilling its Obe-4 appraisal well in offshore Nigeria, some of which was part-financed by $7.7 million (£5 million) it raised in May, 1997.

During the 12-month period Tuskar incurred substantial costs on drilling its Obe-4 appraisal well in offshore Nigeria, some of which was part-financed by $7.7 million (£5 million) it raised in May, 1997.

The company said the decline in oil prices during the year, together with reduced oil production from its British Buchan Oil Field because of a planned shutdown for a month this year, wiped out the profit margin, leading to an operating loss of £26,000.

The 12-month figures also reflect an exchange rate loss of £413,000 arising from its US denominated loan facilities.

Overall the results show a net loss per share of 0.15p.

Chairman, Mr Howard Wolf, said the board was seeking a joint venture partner to contribute to the cost of the Obe development.

"This will mean a dilution of the company's interest but, considering the prevailing circumstances, the board is of the opinion that this will probably offer the company the only viable and fairly immediate opportunity for obtaining the cash-flow it needs."

It has approached a number of companies which are known to have an interest in gaining a foothold in the west African exploration area and several are now considering a possible link-up, according to Mr Wolf.