Short seller targets White Nile

NOTORIOUS short seller Simon Cawkwell has launched a fresh attack on soaraway oil venture White Nile as the company floated by former England cricketer Phil Edmonds prepares for trading in its shares to restart.

Cawkwell, the bear raider nicknamed Evil Knievil, is convinced the shares will tumble once the Alternative Investment Market (Aim)-listed cash shell's stock is unfrozen.

'I stand to make £200,000 and I will make it,' he said. The claim is the latest salvo in a war of words that has formed an intriguing backdrop to the White Nile story ever since the shares were suspended following a 13-fold surge last month.

It comes as White Nile plans a public relations blitz in South Sudan this week, centred on a meeting with John Garang, leader of the political arm of the rebels in the region.

The City is still awaiting full details of White Nile's agreement over an exploration block in the country. A 120-page document explaining the deal is due when share trading restarts, probably next week. White Nile claims to have been awarded a 67,500 square kilometre zone by the provisional government in the south.

The government's own national oil company plans to buy into the company in a reverse takeover. White Nile's shares raced from 10p to 138.5p in early February, valuing it at £205m, as rumours of the deal emerged, and Cawkwell is adamant they will drop like a stone.

Under his short-selling gamble, he has sold White Nile shares at 100p and plans to buy them back at between 10p and 15p. He argues that there are 'many serious question marks' hanging over the deal, not least the claim that French oil giant Total has on part of the land falling under White Nile's jurisdiction from a contract in the 1980s.

Cawkwell added: 'Any oil leaving Sudan will subsequently have a freezing order placed on it by lawyers acting for Total, and that seems to me to be an end of it. But I go a stage further. The South Sudanese may claim to have authority to give out contracts but very probably haven't. Also, the place can't be regarded as peaceful yet.'

Meanwhile, Edmonds and business partner Andrew Groves are spinning behind the scenes and sources close to White Nile claim fund managers backing it have already signed up to a £15m placing at 150p.