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by Stockwatch Business Reporter

West Texas Intermediate crude for March delivery added $1.57 to $52.78 on the New York Merc, while Brent for March added $4.47 to $61.52, breaching $60 for the first time this year (all figures in this para U.S.). Western Canadian Select traded at a discount of $13.35 to WTI ($39.43), up from a discount of $13.40. Natural gas for March added 9.1 cents to $2.80. The TSX energy index added 2.11 points to close at 236.06.

Keith Hill's Africa Oil Corp. (AOI), a Lundin company, lost 24 cents to $2.79 on 733,200 shares. Trading was halted yesterday ahead of the company's announcement of a $100-million (U.S.) private placement. Africa Oil needs the money because, as it has noted for months, its current cash will run out by midyear. The proceeds will go toward its core South Lokichar basin asset in Kenya, owned with Tullow Oil. Before the open this morning (when the stock resumed trading), Africa Oil boosted the placement to about $125-million (U.S.), comprising 57 million shares at $2.74 (Canadian). It has 312 million shares outstanding. More than dilution, shareholders may be worried about what the financing's timing means for the next set of drill results from Kenya. Africa Oil's president and CEO, Mr. Hill, has been saying for months that if he has to do a financing, he would like to do it on the back of good news. He also said that he did not really want to do a financing at all and would prefer a farm-out, but his words were taken with a grain of salt: When Africa Oil was running out of cash in late 2013, Mr. Hill called a private placement our "least desirable option" in September, before announcing one a month later. Investors who remembered that likely expected a repeat this time. As well, if they took part in that financing, they are probably kicking themselves. Each share cost $8.25. The stock rose to $10.61 in November, 2013, but then it begin to sink, mainly because of lacklustre results in Kenya. Although four new discoveries were made at South Lokichar in 2014, efforts in other basins were almost always disappointing. The next exploration well with results expected soon is Engomo-1 in the North Turkana basin. This is the biggest basin in Africa Oil's portfolio. The well is currently being drilled, and investors are reasoning that if things were looking good, Africa Oil would have waited to announce a financing. This reasoning is likely incorrect because the Lundins, being experienced financiers, know that a successful financing is profitable for investors as soon as possible, which in this case would be before the stock rises on good news, not after. Africa Oil did not discuss Engomo-1 except to say that drilling is expected to finish in March.

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