The small-cap tycoon with his money in fish fingers

There are plenty of larger than life characters in the penny share world, but few can match David Lenigas.

David's language is colourful, his opinions take no prisoners, and he certainly could not be accused of understatement. "Vatukoula Gold", he roared as I walked into his elegant office in Jermyn Street "is the cheapest gold share in the world!"

"For 72 years it has been producing an average of 11 grammes per tonne", he explained. "That is more than five times the average grade of the world's known gold resources - and it has got the reserves to produce at 13g/t for another 43 years."

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Originally a mining engineer, David is now Chairman of four AIM listed companies: Lonrho (LSE:LONR), Lonzim (LSE:LZM), Leni Gas & Oil (LSE:LGO), and Solo Oil (LSE:SOLO). He is also chairman of the ASX-listed Lonrho Mining Limited (ASX:LOM) and on the board of the music company Zest Group (LSE:ZEST) and Vatukoula Gold Mines (LSE:VGM). He doesn't mince his words.

Having favoured me with his opinion of the world's best gold mining investment, David then produced a plastic fish wrapper from the top drawer of his desk. "We have had six products listed for the US market - no easy task" he said, turning to the fortunes of Lonrho. "We are going to be sending containers of hake from African waters over to Costco. This is going to be huge. All the retailers have been under massive pressure from Greenpeace, and there is enormous demand for sustainably caught fish. I love fish fingers," he revealed, "and now the supermarkets are going to be able to sell fish fingers with proper fish in them and not the usual processed rubbish. The mums will love it!"

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Food processing is the foundation of Lonrho, which also flies aeroplanes, runs hotels and manages a host of other services across southern Africa. Results due in early November should confirm that this is a good diversified way of investing in Africa's renaissance, but I was really with David to hear about his venture into the oil business.

Where black gold could start spurting next

Leni Gas & Oilwas formed in 2007 to apply modern techniques to oil and gas assets in "the sort of place you would like to take your family on holiday", meaning in this case Spain, the Gulf of Mexico, Trinidad and Malta.

David's theory is that oil fields are "like diamonds - they don't like being lonely". So if you find one parcel of diamonds or oil another is likely to be nearby.Leni Gasis developing Spain's largest on-shore oil field - not that this says a lot, because the little oil that Spain has is mainly off-shore. But David believes thatLeni Gascan boost oil production from under 200 barrels per day to 1,000.

How? By opening up nearby fields and stimulating the flow rate from the existing reservoirs where "there is no fizz in the champagne bottle". In other words, pressure is low but this will be boosted by the injection of liquid nitrogen supplied by Praxair.

Leni Gas's second venture in a mature field is in the Gulf of Mexico. Here it has minority interests in blocks operated by Leed Petroleum (LSE:LDP) and is hoping to boost its share of production to 220barrels per dayby the year-end. But there is more excitement to the Leni Gas & Oil story than incremental improvements to existing fields.

In Spain, David believes that recoverable reserves of oil and gas could be found at deeper levels. And he is also excited about the prospects in two frontier locations: Trinidad and Malta. The former, according to David, "floats on oil". In fact, Trinidad lies off the coast of the major oil producer Venezuela, and yet has never seen more than the most cursory oil exploration. As for Malta, its off-shore waters are adjacent to those of Libya. Libya is already a major producer from on-shore fields, and has now opened up its off-shore acreage to the likes of BP, ENI, Total and Petrobras.

SoLeni Gas & Oilhas some interesting possibilities in the next few years.

Of course, I have my own ideas on where the next big oil find might be. In the last year, I've pursued oil explorers to Texas, Namibia and the Falklands.

They haven't all worked out - that's the nature of backing high-risk oil explorers. But in the last week, one of my latest oil tips has more than doubled. This really is an exciting time to hold stocks in this industry.

If you would like to read about where I think the biggest oil finds of the next decade are going to be, then why not sign up to Red Hot Penny Shares by clicking here - and you'll also find out about my top tip of the moment, concerning a private "breakout event" occurring in a remote corner of South America.

This article was first published on the 21st October in Tom Bulford's twice-weekly small-cap investment email The Penny Sleuth.

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