Why did this ASX oil and gas share just explode 50%?

We take a look at this relatively new ASX energy share.

Rocket powering up and symbolising a rising share price.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • This energy share soared 50% today before slightly retreating 
  • This comes after the company reported "outstanding exploration success" in the Bowen Basin 
  • The energy sector is climbing nearly 1% today 

The S&P/ASX 200 Energy Index (ASX: XEJ) is leaping 0.82% today but this ASX oil and gas share is soaring far higher.

The Omega Oil & Gas Ltd (ASX: OMA) share price soared 53.8% from 19.5 cents to 30 cents today before slightly pulling back. At the time of writing, Omega's shares are soaring 41% to 27.5 cents.

Let's take a look at why this ASX oil and gas share is having such a top run.

What's going on?

Omega shares are rising today after the company reported "outstanding exploration success" in the Bowen Basin, Queensland.

Drilling at the canyon-2 well intersected 293 metres of gas and liquid hydrocarbon shows within the Kianga formation and upper Back Creek Group.

The well has reached a total depth of 3807 metres. Gas covered the entire length of the 221 thick Kianga Formation. The Kianga formation is the primary target of exploration, while the Back Creek Group is the secondary target.

Omega said the results are "extremely positive" and "exceeded expectations".

Commenting on the news, managing director Lauren Bennett said:

We are very excited with these results, and they are an excellent start to our Basin-centered gas drilling campaign.

Given the forecast gas supply shortages, finding and developing new sources of unencumbered gas is critical.

The company said drilling at Canyon-2 is ahead of schedule.

Omega first listed on the ASX in October 2022. Drilling of the canyon-2 well started on 19 March 2023.

Omega share price snapshot

The Omega share price has risen 37.5% in the last year and nearly 62% in the last month.

For perspective, the ASX 200 Energy Index has returned nearly 7% in the last year.

This ASX oil and gas share has a market cap of about $42 million based on the current share price.

Motley Fool contributor Monica O'Shea has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. 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 Scott Phillips.

More on Energy Shares

Miner looking at a tablet.
Energy Shares

Down 12% in a month! Is the Woodside share price finally back in bargain territory?

This stock has lost some investor energy. What now?

Read more »

sad looking petroleum worker standing next to oil drill
Energy Shares

Santos shares hit new lows in October. What next?

There's an interesting risk/reward calculus at play.

Read more »

a man dressed in a green superhero lycra outfit stands in a crouched pose with arms outstretched as if ready to spring into action with a blue sky and oil barrels lying in the background.
Technology Shares

The great Australian ASX Green Tech rally is starting now

The future could be bright – and green, experts say.

Read more »

A miner stands in front oh an excavator at a mine site
Broker Notes

Broker says buy the dip on ASX 200 uranium share with 69% upside

Shaw and Partners says this ASX uranium stock is trading at an attractive price point right now.

Read more »

Coal miner standing in a coal mine.
Energy Shares

This dividend stock is set to beat the ASX again and again

Depressed starting valuations may be of help.

Read more »

Miner looking at a tablet.
Energy Shares

Here's where this expert thinks the Pilbara Minerals share price is headed next

The ASX lithium share is facing profitability headwinds.

Read more »

Oil worker using a smartphone in front of an oil rig.
Energy Shares

Down 6% in October, what now for the Woodside share price?

After another month in the red, is there a light at the end of the tunnel for Woodside shares?

Read more »

Man restores power on a circuit breaker after electricity outage.
Energy Shares

Down 33%! Why this ASX 200 uranium stock is 'trading at a discount'

This ASX 200 uranium stock is materially undervalued by the market, according to a leading fund manager.

Read more »