Shares in Victoria Oil & Gas (LSE: VOG) have soared by over 12% today after it announced the purchase of a 75% stake in the Matanda licence in Cameroon from a subsidiary of Glencore. Matanda covers an area of around 1235 square kilometres and Victoria Oil & Gas believes that it’s highly prospective for significant natural gas and gas condensate resources.

Victoria Oil & Gas will now assume responsibility for carrying out a work programme to be agreed by the Cameroon government. It expects to start its first phase of seismic data acquisition in the final quarter of 2016. With the Matanda field being adjacent to the company’s existing Logbaba gas production operations, Victoria Oil & Gas sees it as a natural extension of its operations, and it significantly increases its potential in the region since it’s over 60 times larger than the existing concession.

Clearly, today’s news has been well-received by the market and shows that Victoria Oil & Gas has a relatively bright long-term future. While its shares are likely to be volatile and as a smaller company it remains relatively high risk, it could be worth a closer look for less risk-averse investors. But with a number of other oil and gas stocks being cheap, there may be better risk/reward opportunities elsewhere.

Risks remain

Similarly, buying Gulf Keystone Petroleum (LSE: GKP) right now may not be a sound move. Although the prospects for the oil price may gain a boost from a potential deal between oil producing nations to limit supply, Gulf Keystone Petroleum will still face a major risk from the political uncertainty within the Northern Iraq/Kurdistan region. This has already impacted on its receipt of payments for oil exports and although progress is being made on this front, Gulf Keystone Petroleum has debts to repay over the medium term that could be negatively impacted by a lack of payment.

With the outlook for the region being highly uncertain, Gulf Keystone Petroleum remains a high-risk play. While its asset base is very high quality and it has done a stellar job of keeping operations going amidst great uncertainty, with the oil and gas sector being very cheap there may be more appealing buys on offer among its peers.

Investing gem?

Meanwhile, Gem Diamonds (LSE: GEMD) continues to trade on a relatively low valuation, with the Africa-focused diamond miner having a price-to-earnings (P/E) ratio of just 9.2. This indicates that there’s upward rerating potential, while a yield of 2.8% also provides some appeal – especially since dividends are covered 3.8 times by profit and could therefore rise at a brisk pace over the medium-to-long term.

With Gem Diamonds reporting falling sales figures in 2015 due mainly to a lower diamond price, its near-term prospects are somewhat uncertain. For example, its bottom line is forecast to fall by 1% in 2016, but with Gem Diamonds having a strong net cash position and the ability to generate relatively strong cash flows despite difficult trading conditions, it could be worth a closer look for less risk-averse investors.

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Peter Stephens has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.