Exploration veteran Dr John Teeling's company Petrel Resources moved back into the black in 2000 following a private placing and the sale of its Ugandan licence which raised about £1 million (#1.27 million). Petrel showed a pre-tax profit of £40,141 for the year to December 2000, up from a loss of £104,583 in 1999.

However that profit may be short-lived as United Nations sanctions and investment restrictions in Iraq are curbing attempts by the company to develop its oil interests there.

Chairman Dr Teeling said: "UN sanctions have made it impossible to import parts and other essential equipment to maintain output. Restrictions on the investment of capital and technology have effectively halted new field development."

A spokeswoman said that Petrel has applied for two new development blocks in Iraq and the prospects of the company hang on the answer from the Iraqi government.

Dr Teeling said Petrel is uniquely placed to participate in the rejuvenation of one of the world's greatest remaining sources of oil once relations with Iraq normalise. He said Petrel had some 115 billion barrels of oil in its reserves there.

Petrel has had a chequered existence since its formation in the 1980s. Its initial goal was to explore for oil and gas offshore Ireland.

Following an unsuccessful $20 million drilling programme on the Kish basin in the Irish Sea in 1985, Petrel turned its focus to the US. In the early 1990s it changed focus again and disposed of all its oil and gas assets and remained an empty shell until 1995. It re-floated in the UK in 1998 and moved to London Alternative Investment Market in August 2000. It now depends solely on its interests in Iraq.