** Shares of oil and gas explorer Karoon Energy KAR.AX rise 1.6% to A$1.245

** Says co has announced positive news with its Neon oil field project in Brazil progressing to the next stage of development, the Define Phase

** Citi says that Define Phase has increased 2C resources by 44%, which strengthens the project

** Adds, this is likely to reduce cost of equity because the standalone vessel used in offshore oil and gas industry FPSO's concept offers greater diversification

** Brokerage considers staged process amid heightened macroeconomic uncertainty prudent, requiring only small capex commitments until the final investment decision

** Says production and total sales for the first quarter were in line with its estimate

** Maintains 'Buy' rating on Karoon Energy at price target of A$2

** KAR down 10.6% YTD

(Reporting by Kumar Tanishk in Bengaluru)

((Tanishk.Kumar@thomsonreuters.com; X: @thatstanishk http://www.x.com/thatstanishk;))