NORTH Sea-focused Cluff Natural Resources has said it is keen to expand in the area where it believes the recent flurry of mergers and acquisitions will boost activity in the longer term.

The company, which is run by entrepreneur Algy Cluff, said it is preparing to apply for more acreage in the United Kingdom licensing round that was announced last month.

It has focused on conventional exploration activity after shelving controversial plans to produce gas by burning coal under the Firth of Forth amid official opposition to coal gasification technology.

The Aim-listed firm is considering buying into finds that are in the appraisal process and producing assets.

Directors have been pleased with the response the company has had to its attempts to find farm-in partners to buy into the licences it holds in the Southern North Sea. It reckons these contain attractive prospects.

But the farm-out process is taking longer than anticipated, possibly because some key players have been doing M&A deals that left them too busy to look at such investments.

The company noted many of the deals involved separating oil and gas exploration divisions from risk averse utilities and conglomerates. It predicted they would result in the formation of new businesses that would be keen to explore in the Southern Gas Basin.

London-based CNR lost £774,288 in the first half against £662,473 last time.