Oil price, Echo Energy, Frontera Resources, Zenith Energy, President Energy And finally... Fri, 25 May 2018 12:47:00 +0100 WTI $70.71 -$1.13, Brent $78.79 -$1.01, Diff -$8.08 +12c, NG $2.94 +3c

Oil price

The big question now is, have we reached a level at which most industry participants find acceptable? At $80 it seems that talks between producers are scheduled to see if they shouldn’t release a bit of crude into the market to avoid any panic from consumers, as evidenced by the Indian pleas last week. Certainly it seems that the KSA and Russia are talking with an idea of scaling back the cuts from the joint producers. Khalid Al-Falih said this morning that these were ‘on the table’ and that whilst no decision had been made yet ‘we will not overcorrect’ and that the two countries would meet at least twice before the full Opec/Non-Opec meeting next month.

It is a good time to be thinking about the effect $80 oil will have on the consumer particularly in the US where the Memorial Day Holiday on Monday signals the start of the driving season. For what it’s worth my guess is that if it does turn out to be that $80 is a level to be defended then it pretty much works for both sides, let’s see.

Geopolitics heated up a bit overnight with the news that the Trump/Kim summit is off, at least for the time being, no reason why it can’t be reinstated another time though although tensions are still high.

Echo Energy

Echo has announced that it has raised £8.5m through a placing and subscription at 12p with funds raised to accelerate their full seismic commitment over Tapi Aike at a really competitive price saving the company some $7-8m. It seems that the company needed to strike whilst the iron was hot, so to speak, and with the current offer for the seismic work being some 30% less than expected and about to expire this is a no-brainer. When you are looking at 2,000km² and that Tapi Aike is the blue chip asset waiting to be assessed this concentrates the mind and shareholders should rejoice.

As to the raise it also seems eminently sensible to me, getting institutions on board at a reasonable discount is very wise and that an open offer was impossible given the time needed to produce documentation. With the rate of progress on the Fracción C drilling programme, where the next well spud is imminent, finding the necessary ten clear days would be at best counter productive. As I understand it the quality of institutions is first class and balances the shareholder list well.

The share price has fallen 15% at time of writing which is technically understandable given the discount offered but definitely provides an opportunity for those who believe that this shows all the hallmarks of a really good play with significant upside.

Frontera Resources

Morr good news from Taribani today from Frontera where results have continued to please since I reported back from T-45 in February. News is that the T-39 sidetrack well has reached TD and the combined pay from zones 9, 14 and 15 is 102.5m with 14.2% porosity and some 12.3m of pay in zone 13. One certainly can’t accuse these wells of creating a surprise, all zones are performing at the highest of expectations.

The company has also announced that it has received a drilling permit for the Niko-1 well which is scheduled for November of this year, unsurprisingly the zones expected are as per previous successes. The company has been offered a $3m investment by an institutional investor to finance this well which makes life significantly easier. These drilling successes will before long feed through to a ‘strong revenue stream’ and the company are promising details shortly of the drilling campaign for 2019. FRR looks to be in increasingly good nick and with what I hear is promising news from Block the Azerbaijan is going to be increasingly in the news for all the right reasons.

Zenith Energy

Zenith has announced that it has signed a $2m non-convertible loan facility, it will be used to provide additional funding ‘for the Company’s operations when required’. It will be drawn down intranches when required and has no warrants attached. Zenith is quite rightly concentrating its fire power on current operations in Azerbaijan where recent investment is beginning to pay off, this will enable it to continue with this strategy.

President Energy

A brief mention of a reception held by President earlier in the week at which the Argentinian Ambassador to St James and the Energy Minister made presentations. Whilst there is a concern about short term economic conditions, acknowledged by the Ambassador, longer term advantages of investing in this country remain and i’m sure that the President share price will in due course rise accordingly.

And finally…

As we close in on the end of the winter sporting season it is a weekend where spring and summer collide. Football sees the Champions League final in Kiev with the HubCap Stealers taking on Real Madrid. If previous rounds are to be believed anyone could win and there could be many goals scored.

Earlier on in the afternoon the Championship play-off has Fulham taking in the Villa in what is being labelled the £100m game….That is followed on Sunday by Rotheram v Shrewsbury and on Monday Coventry v Exeter.

Rugby’s season closes with the Premiership final between the Exeter Chiefs  and Sarries, again if scores in the semis are any reflection it too could be a cricket score.

Talking of cricket England were wishing that the no toss rule was in place as it was a bad toss to win, as it was they batted and on day one of the series reminded us of the phrase England middle order batting collapse’…..

Last year I was in Monaco for the GP, this year i’m here wishing I was back but the early pace is being made by the Red Bulls with Mercedes saying that this is just not their track.

Finally thank you for helping with so many people obeying the GDPR and today is the first day of the new mailing list.

]]> Haydale Graphene expands to bring cutting tool manufacturing in-house Fri, 25 May 2018 10:23:00 +0100 Haydale Graphene Industries PLC's (LON:HAYD) Ray Gibbs tells Proactive that the company is investing in its South Carolina facilities to bring the manufacture of its new cutting tool in-house.

Gibbs says that the demand for its cutting tool in the aerospace industry to manufacture turbine blades has pushed the company toward the expansion.

He adds that the US$1.5mln investment allows the company to make the products directly and is a significant move that can be refinanced through debt going forward.

]]> Ceres Power secures partnership with Chinese giant Weichai Power Fri, 25 May 2018 09:15:00 +0100 Ceres Power Holdings PLC's (LON:CWR) Phil Caldwell tells Proactive the company has secured access to the  Chinese market through a partnership with Weichai Power, a Chinese engine manufacturer with a US$10bn market cap.

He adds that Weichai also has a large market presence in electric buses, forklift trucks and other automotive applications.

Caldwell also says that Weichai will put £40mln of capital into the company, along with a development agreement to develop a range extender for electric buses.

]]> Centamin plunges on forecasts for weaker second quarter as low grades persist at Sukari Fri, 25 May 2018 09:03:00 +0100 SSE expects challenging year ahead as it merges UK energy supply arm with npower Fri, 25 May 2018 08:30:00 +0100 Pennon sees full-year profit, dividend rise, positive on outlook for water and waste Fri, 25 May 2018 07:37:00 +0100 i3 Energy notes US$500,000 loan conversion Fri, 25 May 2018 06:51:00 +0100 Haydale Graphene strengthens cutting tools capacity as traction builds Fri, 25 May 2018 06:34:00 +0100 Echo Energy raises £8.5mln to accelerate Argentina exploration campaign Fri, 25 May 2018 06:29:00 +0100 Tabakoroni results show "rapidly unfolding major discovery" for Resolute Mining Fri, 25 May 2018 01:29:00 +0100 Resolute Mining Ltd (ASX:RSG) managing director and chief executive John Welborn speaks to Proactive Investors about the “exceptional” results from multiple holes of reverse circulation (RC) and diamond drilling at the Tabakoroni Project, 35 kilometres south of the company’s Syama Gold Mine in Mali.

At Tabakoroni Nord, the multi-rig drilling program is expected to grow the previously defined resource, where open pit mining is scheduled to commence in the coming months. Meanwhile, at the Tabakoroni Main Zone, today’s announcements have revealed the potential for a new underground mine.

Exploration efforts around the wider Syama area will now be increased to investigate the full resource potential revealed with each round of thick section, high-grade results, with a focus on the Nafolo discovery.

At the Syama gold mine, oxide and sulphide processing plants are producing, as a world-class sublevel cave operation develops, set for completion in December of this year.

]]> CROP Infrastructure Corp trading under 'CRXPF' on OTC Markets Thu, 24 May 2018 15:56:00 +0100 Prospex Oil & Gas has "a tiger on a leash" with Spanish prospect Thu, 24 May 2018 11:58:00 +0100 Prospex Oil & Gas PLC's (LON:PXOG) Edward Dawson tells Proactive the company is chasing a geological play across its three assets in Europe, and has a well in Romania that is about to go into production.

He adds that the company's Italian license, in which it has 17%,  has seen surprising flow tests that suggest production rates will be "significantly better" than previously thought.

The group also has a project in Spain where it is planning to drill the first modern well, with Dawson saying the potential is like "a tiger on a leash".

]]> Europa Oil & Gas shifts focus to Inishkea gas prospects Thu, 24 May 2018 10:07:00 +0100 Europa Oil & Gas (Holdings) PLC's (LON:EOG) Hugh Mackay tells Proactive that the company has elected to relinquish its LO16/21 license off the west coast of Ireland to focus on the LO16/20 gas prospects at Inishkea.

Mackay adds that shift in focus is toward a lower risk play, with an exploration well having a target spud date of 1 June 2019.

Europa is also "punching above its weight" in the region, standing equal to other regional players such as Exxon Mobil and StatOil, Mackay says.

]]> VSA Capital Market Movers - Independent Oil & Gas#: 30th UK Licensing Round Awards Thu, 24 May 2018 09:37:00 +0100 Harvey Expanded, Broader Structure Captured

Independent Oil and Gas (IOG LN) has received four additional blocks in the 30th round of UK Licensing in the North Sea, with the shares up 8% on the news meaning the stock is up 38% YTD. The blocks could, in our view, strengthen the development of the Southern North Sea gas hub IOG is developing.

The first of these blocks (48/24a) completes IOG’s licensing of the Harvey structure increasing its attributable prospective resource from 90BCF to 114BCF on a best estimates basis. Although we had expected IOG to expand the license to the whole structure it was not included in our prior valuation which is adjusted up as a consequence.

Additional Goddard and Abbeydale Blocks

As well as the extension to Harvey, IOG received blocks in two additional areas. The first known as Goddard (48/11c & 48/12b) is now the single largest discovery within IOG’s portfolio with a management estimate of contingent resources at 1C/2C/3C, 45/189/396 BCF. Five wells were drilled between 1985 and 2019 proving the resource and IOG has committed to reprocessing 3D seismic and drilling one well within 3 years of license award.  The Abbeydale block 53/1b, to the West of Camelot Central South, contains a dormant gas discovery and management estimates contingent resources at 1C/2C/3C 5/11/24BCF. With only outdated existing seismic data, we expect a new 3D programme to expand on this estimate and demonstrate the broader potential.

Recommendation and Target Price

The additional blocks materially enhance IOG’s portfolio and we have revised our valuation to reflect the added total gas resources from 393BCF to 617BCF. In all cases the blocks could reasonably be tied back to the Thames Pipeline, in our view, further strengthening the gas hub strategy.

The intelligent pigging programme continues with results due soon. Confirmation of the Thames Pipeline’s expected good condition will be a major step towards the Final Investment Decision in August 2018. With a supportive backdrop of gas pricing and concerns over UK energy security we believe IOG is well placed to execute its strategy and realise the significant upside potential.

We reiterate our BUY recommendation although increase our target price by 33% to 96p.

]]> AIM oilers add discoveries and new exploration projects in North Sea licensing round Thu, 24 May 2018 09:33:00 +0100 United Utilities ebbs lower as full-year profits fall Thu, 24 May 2018 07:37:00 +0100 ADES International adds to firepower with US$140mln Saudi facility Thu, 24 May 2018 07:15:00 +0100 Victoria Oil & Gas first quarter reveals impact of ENEO issue Thu, 24 May 2018 07:11:00 +0100 RockRose Energy doubles production as it splashes £94mln on Netherlands assets Thu, 24 May 2018 07:06:00 +0100 United Oil & Gas lands Crown discovery in UK licensing round Thu, 24 May 2018 06:41:00 +0100 Range Resources exceeds oil production targets thanks to recent well optimisation work Thu, 24 May 2018 06:38:00 +0100 Greka Drilling secures Chinese drilling contract and remains bullish on India despite setbacks Thu, 24 May 2018 06:31:00 +0100 Europa Oil & Gas lets go of acreage as it narrows focus on Inishkea prospects Thu, 24 May 2018 06:20:00 +0100 Eden Innovations shares up 20% in intra-day trading Thu, 24 May 2018 05:07:00 +0100 FAR prepares to drill for oil offshore The Gambia, backed by oil major PETRONAS Thu, 24 May 2018 03:05:00 +0100 Carnarvon Petroleum set to "bring forward the next phases of value for shareholders" Wed, 23 May 2018 23:30:00 +0100 Carnarvon Petroleum Ltd (ASX:CVN) managing director Adrian Cook speaks to Proactive Investors, as drilling happens at Western Australia's prolific North West Shelf.

"We've proven up a working petroleum system in this area. What we're now looking to do is cement commerciality of the resources... very shortly we're going to have two wells drilling into our Phoenix Project, both of which are looking to turn this project from Proof of Concept to a commercial project," says Cook.

The oil and gas exploration company completed a $16 million placement earlier this month, and will now accelerate plans to redevelop a former oil field, known as the Buffalo Project.

]]> VAALCO Energy soars after it knocks out outstanding debt with IFC Wed, 23 May 2018 19:35:00 +0100 i3 Energy sees "significant" increase in base resource at Liberator oil field Wed, 23 May 2018 15:09:00 +0100 i3 Energy PLC's (LON:I3E) Neill Carson and Graham Heath tell Proactive that the combined resource & reserve base of its Liberator oil field has jumped from 11mln barrels of oil to 80mln barrels.

Carson says the company is planning an appraisal well for the end of 2018.

Heath adds that the company expects the award to contribute positively to ongoing discussions around potential joint venture partnership opportunities.

]]> High Power Petroleum's technology in the spotlight after Cabot revival Wed, 23 May 2018 11:59:00 +0100 Faroe Petroleum commits to new Brasse exploration well Wed, 23 May 2018 09:31:00 +0100 Empyrean Energy shares drop despite Dempsey production plans Wed, 23 May 2018 08:56:00 +0100 i3 Energy lands significant expansion for Liberator field Wed, 23 May 2018 08:52:00 +0100 Severn Trent unveils £100mln investment drive as full-year profits climb 4% Wed, 23 May 2018 07:44:00 +0100 Cabot Energy reassesses summer drilllng plans in Canada Wed, 23 May 2018 06:41:00 +0100 Carnarvon Petroleum about to set-up Dorado-1 well targeting gas and liquids Wed, 23 May 2018 03:38:00 +0100 Hillcrest Petroleum set to pursue Western Canada opportunities under new tie-up Tue, 22 May 2018 13:01:00 +0100 Andalas Energy shares fall as it updates on directors' pay Tue, 22 May 2018 11:08:00 +0100 Buru Energy accelerating exploration efforts following Roc Oil transactions Tue, 22 May 2018 10:26:00 +0100 Buru Energy (ASX:BRU) executive chairman Eric Streitberg speaks to Proactive Investors about the Australia-focused oil and gas company's recent deal with Roc Oil (ASX:ROC) to sell half of its 100% ownership in the Ungani Oilfield for $64 million, and enter a Joint Venture on three of its most advanced exploration permits for a carry of $20 million. Buru Energy retains operatorship.

"The lifeblood of any company like ours is finding more oil and producing more oil, and that of course requires capital. So this seemed like a good time to bring in a partner who had a big balance sheet and was able to help us move the project forward more quickly than we would have been able to do with our internal resources," says Streitberg.

]]> SDX Energy moving on to appraisal at South Disouq after latest well makes uncommercial gas find Tue, 22 May 2018 09:35:00 +0100 Serica Energy shares drop as new US sanctions on Iran hit UK North Sea project Tue, 22 May 2018 09:24:00 +0100 SDX Energy to make 2017 assets cash-generating in 2018 Tue, 22 May 2018 09:14:00 +0100 SDX Energy's (LON:SDX) Paul Welch tells Proactive that the company is currently aiming to make its 2017 discoveries cash-generating assets in 2018.

Despite an unsuccessful exploration at its Kelvin-1X well, Welch says the second quarter of 2018 will be the busiest, with 2 additional appraisal wells planned in Egypt as well as well testing in Morocco.

]]> Carnegie Clean Energy raises $5.3 million for solar, battery and wave energy projects Tue, 22 May 2018 05:01:00 +0100 Brookside Energy’s transformational business model validated with successful strategic divestment Tue, 22 May 2018 03:20:00 +0100 Brookside Energy Ltd (ASX:BRK) managing director David Prentice explains the company’s strategic focus to Proactive Investors, as a successful case study is revealed to the market. The oil and gas E&P company, which operates in the world-class Anadarko Basin in Oklahoma in the US, has adopted a land leasing and development approach that is “somewhat unique” in Australia, but has a proven history in the US.  

“Essentially, we’re acquiring undeveloped acreage across the Anadarko Basin in the hope of having that acreage revalued, as well as get drilled and reserves get booked…we’re very passionate about the fact that this strategy provides the best leverage for our shareholders,” says Prentice.

Brookside today announced the divestment of the first of its non-operated development units that has progressed to ‘full field’ development, at a price per acre that is greater than 10-times the average acquisition cost.

]]> Altech Chemicals secures HPA plant site with final payment Tue, 22 May 2018 01:54:00 +0100 Buru Energy to receive $84 million through sale and farm-in deal Tue, 22 May 2018 00:16:00 +0100 88 Energy primed for catalysts as investors look to testing restart in Alaska Mon, 21 May 2018 13:39:00 +0100 Shell shareholders are enjoying an oil price sweet-spot; how long can crude rally last and how much higher? Mon, 21 May 2018 11:23:00 +0100 High Power Petroleum transforming both oil exploration and production Mon, 21 May 2018 09:52:00 +0100 High Power Petroleum is owned by private company I-Pulse, which develops industrial applications for high-pulse power technology.

Scott Aitken, High Power's chief executive tells Proactive Investors the business was formed to leverage that technology across two specific applications within the petroleum industry.

''The expertise at I-Pulse has seen them take a very small amount of energy that you might find in a cellphone battery and then release that energy in the order of a billionth of a second to create very high levels of power during that instant ... that creates significant phenomena that can be utilised to create different types of engineering applications''.

In a very short space of time that produces a shock to the ground and is sufficient in old wells to clear backlogs of debris and shake up a reservoir to boost production rates sharply.

In exploration situations, meanwhile, the technology acts in a similar way to seismic, producing images of ground formations and importantly what lies within them

]]> Upland Resources investors boosted by Malaysia update Mon, 21 May 2018 08:38:00 +0100 88 Energy gains as it says to restart Project Icewine well test in June Mon, 21 May 2018 07:55:00 +0100 Kosmos Energy forced to reset Anapai drilling Mon, 21 May 2018 07:02:00 +0100 Highlands Natural Resources tweaks strategy following East Denver progress Mon, 21 May 2018 06:31:00 +0100 Emmerson Resources shareholders overwhelming support joint venture restructure Sun, 20 May 2018 23:16:00 +0100 Emmerson Resources Ltd (ASX:ERM) managing director Rob Bills updates Proactive Investors, as the company announces the vast majority of its shareholders have overwhelmingly voted to formally approve the restructuring of the Tennant Creek Mineral Field joint venture with Evolution Mining (ASX:EVN).

The Australian gold resource company is currently midway through a 2,400 meter drilling program at Tennant Creek, seeking to add the Malbec and West Gibbet targets to its small mines portfolio, and further exploring the Mauritania greenfield discovery. Elsewhere at Tennant Creek, an Airborne EM survey of Jasper Hills and Edna Beryl areas has recently concluded, and that data being compiled now.

Emmerson Resources is also processing data from its NSW project, which is set to be released in the coming weeks.

]]> 'It's been a great week at the office', says Union Jack Oil's David Bramhill Fri, 18 May 2018 15:12:00 +0100 David Bramhill, executive chairman at Union Jack Oil PLC (LON:UJO) looks back on a week that's seen a series of positive announcements for the company.

On Monday shares advanced after extensions were granted to planning permission for the Biscathorpe-2 and North Kelsey-1 well site locations.

Then on Tuesday UJO acquired a stake in two potential UK shale projects, with a minimal upfront investment.

And then on Thursday the government gave “wholehearted support” to the UK's onshore shale gas industry - a move Bramhill said he's delighted with.

]]> Goldman Sachs upgrades Tullow Oil and Cairn Energy on crude strength Fri, 18 May 2018 12:13:00 +0100 Echo Energy hails gas discovery at Fracción C asset in Argentina Fri, 18 May 2018 11:30:00 +0100 Fiona MacAulay, chief executive of Echo Energy Plc (LON:ECHO), discusses with Proactive's Andrew Scott the gas discovery in the ELM-1004 exploration well, at the Fracción C asset, onshore Argentina.

As the first well in a four well programme, it marks a successful start to Echo’s exploration campaign.

]]> Block Energy to switch to AIM from NEX exchange Fri, 18 May 2018 10:56:00 +0100 VSA Capital Market Movers - Egdon Resources Fri, 18 May 2018 10:20:00 +0100 Egdon Resources (LON:EDR)

Yesterday the UK Government provided a Written Ministerial Statement on the UK shale gas industry. Despite backing from the Government in its election manifesto, progress has been slow in terms of project development although. However, with a number of key milestones coming up this summer this intervention is a timely and positive step, in our view.

The statement which reiterates the Government’s support for shale gas development and its national importance given rising UK energy imports must now be considered by planning committees when making decisions on applications. In addition the Government will publish revised planning practice guidance on shale development this summer and will launch two consultations; one to consider allowing wells to be drilled under permit rather than a full application and one to consider including shale production projects in the Nationally Significant Infrastructure Projects regime.

Given the complexity and technical nature of oil and gas permitting, the statement also indicates further support for Local Authorities to help them better understand the issues surrounding the development process.

Although the UK Government has previously indicated its support for shale gas development we believe this more direct approach is likely to be more effective and bodes well ahead of a key summer of testing by Cuadrilla, Egdon (LON:EDR) and IGas (LON:IGAS). As one of two companies listed in the UK offering exposure to shale gas development we believe that EDR offers attractive exposure to the industry. Currently trading at around 9p the shares reflect little of the upside potential and have been deeply discounted largely as a result of permitting risk, however, this announcement strongly indicates that the Government intends to support applications.

]]> Serinus Energy to leave Toronto exchange after £10mln fund raising closes Fri, 18 May 2018 10:08:00 +0100 Ophir Energy shares drop as CEO steps down Fri, 18 May 2018 08:36:00 +0100 Rockhopper Exploration ready to rock and roll in the Falklands as US$400mln funding talks near completion Fri, 18 May 2018 07:06:00 +0100 Union Jack Oil delighted with UK govt support for shale projects Fri, 18 May 2018 06:54:00 +0100 SDX Energy sees better than expected well test at latest Egypt discovery Fri, 18 May 2018 06:38:00 +0100 Echo Energy unearths new gas discovery in Argentina Fri, 18 May 2018 06:24:00 +0100 President Energy kicks off workover programme at Puesto Flores in Argentina Thu, 17 May 2018 14:16:00 +0100 President Energy PLC's (LON:PPC) finance director Rob Shepherd chats to Proactive Investors about their seven well workover programme which has commenced at Puesto Flores.

Shepherd also looks ahead to the accelerated three well drilling programme which has been slated to begin in September.

Plus he discusses what's in store for the group's other assets in Paraguay and Louisiana.

]]> Eland Oil & Gas looking forward to Ubima field programme Thu, 17 May 2018 12:41:00 +0100 Active Energy Group surges after acquiring a controlling interest in Canadian forestry company Thu, 17 May 2018 11:52:00 +0100 Hurricane Energy is ticking all the boxes as it approaches major value catalysts Thu, 17 May 2018 11:35:00 +0100 SDX Energy 'hitting its stride' & benefiting from operational success Thu, 17 May 2018 11:08:00 +0100 SDX Energy Inc (LON:SDX, CVE:SDX) CEO Paul Welch caught up with Proactive's Andrew Scott to talk through their first quarter update and outlook for the year ahead.

The results for the period confirmed SDX is benefiting from its operational successes in Egypt and Morocco.

The months were punctuated by exploration and appraisal achievements, which add to the group’s growing production profile.

Output for the three months, ended March 31, averaged 3,036 barrels of oil equivalent.

]]> Active Energy to acquire controlling stake in forestry company in Alberta Thu, 17 May 2018 09:41:00 +0100 Richard Spinks, chief executive of Active Energy Group PLC (LON:AEG), tells Proactive's Andrew Scott they're to acquire a controlling interest in PowerWood Canada Corp, a privately owned Canadian forestry company.

PowerWood holds substantial forestry assets in Alberta, Canada, under forestry management agreements, and deciduous cutting rights issued by the Crown Province of Alberta.

]]> Barclays upgrades Premier Oil as stronger crude price eases debt concerns Thu, 17 May 2018 09:28:00 +0100 Genel ‘continues to build momentum’ in Kurdistan Thu, 17 May 2018 08:34:00 +0100 National Grid expects top end medium term growth as dividend hiked Thu, 17 May 2018 07:33:00 +0100 Faroe Petroleum banks US$68mln as it completes Fenja field stake sale Thu, 17 May 2018 07:06:00 +0100 Resolute Mining resolute in becoming a multi-mine global gold producer Thu, 17 May 2018 07:03:00 +0100 Resolute Mining Ltd (ASX:RSG) managing director and chief executive John Welborn updates Proactive Investors on the Africa-focused gold mining company’s operations.

One of two projects currently operating and producing gold, the Syama Gold Mine in Mali, is progressing towards the goal of becoming a world-class sub-level cave operation. "We're currently operating two processing plants there: an oxide plant which is fed by satellite open pit mines, and the large-scale historic sulphide circuit which [is] processing stockpiles while we build an underground mine. That underground mine is due to start sub-level caving in December of this year," says Welborn.

The company’s second gold producing asset, the Ravenswood Gold Mine in Queensland, Australia, has recently gained final approvals for an expansion that should take annual site production beyond 120,000 ounces, over a mine-life of 13 years or more.

At the historic Bibiani Gold Mine in Ghana, a second feasibility study is in its final stages, and should be released before the end of this quarter. Resolute Mining will then make a development decision.

Exploration around existing assets designed to enhance operations is ongoing. Meanwhile, the company has made a number of strategic investments in junior gold miners and select potential development plays. Welborn explains, "we're establishing a portfolio of gold companies that we think will add a pipeline of growth to Resolute shareholders... it's a really strong end to the financial year for Resolute.”

]]> SDX Energy first quarter shows benefits of well successes Thu, 17 May 2018 06:47:00 +0100 Hurricane Energy sees another development milestone for Lancaster project Thu, 17 May 2018 06:25:00 +0100 Carnarvon Petroleum’s Phoenix South-3 well reaches 3,733 metres targeting North West Shelf gas and liquids Thu, 17 May 2018 00:22:00 +0100 Greenland Minerals shareholders vote in favour of name change Wed, 16 May 2018 22:19:00 +0100 Permex Petroleum raises C$4.067mln in IPO; starts trading on CSE on May 17 Wed, 16 May 2018 19:11:00 +0100 CROP Infrastructure represents compelling opportunity in North American cannabis industry, says CFN Media Wed, 16 May 2018 17:42:00 +0100 Providence Resources offering investors a 'unique opportunity ahead of next wave of activity' Wed, 16 May 2018 15:10:00 +0100 Tony O'Reilly, chief executive of Providence Resources PLC (LON:PVR), caught up with Proactive's Andrew Scott to discuss their 2017 results, a period which saw 3 major exploration farm-out deals agreed, as well as what investors can expect in the year ahead.

This April, Providence unveiled a long awaited farm-out transaction which will see the Barryroe oil field advance towards development, with a proposed three-well appraisal drill programme and testing.

]]> Canadian Solar shares shine after doubling revenue in its first quarter Wed, 16 May 2018 12:53:00 +0100 Centrica weighed by Morgan Stanley downgrade following British Gas owner’s recent trading update Wed, 16 May 2018 12:14:00 +0100 Ceres Power announces partnership with China’s Weichai Power and £17mln potential equity investment Wed, 16 May 2018 10:55:00 +0100 Itaconix shares double in value as collaboration with AkzoNobel moves to the marketing phase Wed, 16 May 2018 10:44:00 +0100 Morgan Stanley sees market moving away from Wood Group Wed, 16 May 2018 09:21:00 +0100 Horse Hill: What’s next at the Gatwick Gusher? Wed, 16 May 2018 08:15:00 +0100 Premier Oil’s Catcher field ramp-up continues to drive production growth Wed, 16 May 2018 07:11:00 +0100 Cadogan Petroleum updates on licence delay in Ukraine Wed, 16 May 2018 06:49:00 +0100 Eland Oil & Gas expects Opuama-9 well to top production guidance Wed, 16 May 2018 06:33:00 +0100 Hurricane Energy brings Lancaster field development into installation phase Wed, 16 May 2018 06:20:00 +0100 Simble Solutions secures primary Australian distributor deal for energy platform with Synnex Tue, 15 May 2018 23:05:00 +0100 Reward Minerals affirms globally significant SOP project with PFS Tue, 15 May 2018 23:00:00 +0100 Reward Minerals Ltd (ASX:RWD) chief executive Greg Cochran tells Proactive Investors the Potash-focussed exploration company has potentially found the largest and longest-life brine SOP Project outside of China, as detailed in a pre-feasibility study (PFS) recently released.

The PFS on the company’s flagship LD Project in Western Australia details a development period of just over three years plus a one-year production ramp up. Pre-tax net present value (NPV) calculated at a rate of 8% is $460 million, representing an internal rate of return (IRR) of 18%.

"The most important thing fundamentally about LD - the full name being Lake Disappointment, which I do like to talk about because I say, 'here's a project that is anything but disappointing' - it's got a wonderful future, given that here in one place, [in] one single deposit, we have what is arguably a hundred year plus operation... the PFS that we've just released extracts only 6% of the current existing resource," says Cochran.

]]> TAG Oil names Peter Loretto to board of directors Tue, 15 May 2018 15:40:00 +0100 Touchstone Exploration ' comfortably ahead of production expectations' Tue, 15 May 2018 13:53:00 +0100 Paul Baay, chief executive of Touchstone Exploration Inc (LON:TXP, CVE:TXP), spoke to Proactive Investors to discuss this week's financial and production updates.

Results for Touchstone's first quarter reveal some US$7.42mln of revenue, up around 50% from the same period in 2017.

The company’s production, up 21% to 1,543 bopd, saw a realised net back of US$33.53 per barrel which was a 42% improvement from the 2017 comparative.

]]> CUI Global’s GasPT Technology attracts industry interest after being approved by UK's energy regulator Ofgem Tue, 15 May 2018 13:03:00 +0100 The Oil and Gas Council rep talks trends in energy investments in Mexico, Argentina, Canada Tue, 15 May 2018 12:41:00 +0100 The Oil and Gas Council rep Tim Pawul tells Proactive Investors the status of energy investments in Mexico, Argentina, and Canada.

]]> BP and Royal Dutch Shell targets upgraded by HSBC Tue, 15 May 2018 11:30:00 +0100 Falcon Oil & Gas higher as it identifies four additional potential plays at Beetaloo Tue, 15 May 2018 09:35:00 +0100 Touchstone Exploration reveals strong revenue growth Tue, 15 May 2018 08:12:00 +0100 Cairn Energy boss “excited” by busy year ahead Tue, 15 May 2018 08:01:00 +0100 Union Jack Oil acquires UK shale exploration stakes Tue, 15 May 2018 07:18:00 +0100 United Oil & Gas looks forward to Colter drilling as partner inks rig deal Tue, 15 May 2018 06:30:00 +0100 FAR advances opportunities in Senegal and The Gambia as oil price hits multi-year highs Tue, 15 May 2018 03:50:00 +0100 Renegade Exploration bringing innovation to exploration at Yandal Greenstone Belt Mon, 14 May 2018 22:30:00 +0100 Renegade Exploration Ltd (ASX:RNX) non-executive director Mark Wallace introduces the rebranded, repositioned gold exploration and development company to Proactive Investors.

The company is focused on the Yandal Greenstone Belt, where it is taking a camp style approach to around 70 kilometres of strike. A consultant geologist has assessed structural aspects of the local geology and identified 9 high profile targets along 33 kilometres of strike. A 25,000 meter drill program will commence in 4-6 weeks, with results expected to flow in late June or early July.

"In the year 2018 there's a good chance and opportunity to, I think, match technology and innovation with going through some of these old greenstone belts,” says Wallace. To the west of Renegade’s project, Northern Star Resources (ASX:NST) has experienced large-scale success using modern exploration methods to establish the Jundee Gold Mine.

]]> Union Jack Oil shares boosted on Biscathorpe-2 and North Kelsey-1 extensions Mon, 14 May 2018 12:43:00 +0100 Centrica shares edge higher as British Gas-owner on track to meet full year targets despite 'Beast from the East' hit Mon, 14 May 2018 11:35:00 +0100 United Oil & Gas up as says “highly encouraged” as Jamaica seismic programme completes Mon, 14 May 2018 11:35:00 +0100 KrisEnergy quarterly revenue rises on improved oil prices Mon, 14 May 2018 10:51:00 +0100 Market ‘wary’ Centrica could cut dividend, says analyst Mon, 14 May 2018 09:52:00 +0100 Ophir Energy teams up with Kosmos Energy for Equatorial Guinea exploration Mon, 14 May 2018 08:37:00 +0100 U.S. Oil & Gas completes “highly encouraging” Eblana-3 well Mon, 14 May 2018 08:22:00 +0100 Victrex shares drop despite record first half as it warns of currency headwinds Mon, 14 May 2018 07:57:00 +0100 Touchstone Exploration confirms 20% production growth after drilling five new wells Mon, 14 May 2018 06:45:00 +0100 Buru Energy to ramp up oil production from Ungani oilfield Sun, 13 May 2018 23:02:00 +0100 Echo Energy clarifies position regarding Argentinian Peso Fri, 11 May 2018 13:00:00 +0100 Phoenix Global Resources in prime spot as Argentina starts to realise shale potential Fri, 11 May 2018 08:25:00 +0100 Wood Group shares rise as it highlights good trading momentum in the first quarter Fri, 11 May 2018 07:10:00 +0100 Bowleven looks forward to new drilling as rig arrives offshore Cameroon Fri, 11 May 2018 07:04:00 +0100 COPL highlights “significant progress” with Nigeria financing efforts Fri, 11 May 2018 06:45:00 +0100 Highlands Natural Resources spuds six new wells at East Denver oil and gas project Fri, 11 May 2018 06:37:00 +0100 Falcon Oil & Gas highlights strong position in first quarter results Fri, 11 May 2018 06:31:00 +0100 Carnarvon Petroleum on schedule with drilling at Phoenix South-3 well Fri, 11 May 2018 05:20:00 +0100 Carnarvon Petroleum raises $16 million to assist in redeveloping the Buffalo oil field Fri, 11 May 2018 04:31:00 +0100 Altech Chemicals receives US$120 million debt term sheet Fri, 11 May 2018 00:39:00 +0100 Cadogan Petroleum anticipating substantial growth in production Thu, 10 May 2018 07:04:00 +0100 Guido Michelotti, chief executive of Cadogan Petroleum Plc (LON:CAD), caught up with Proactive's Andrew Scott following the release of their 2017 results.

Cadogan revealed a significant increase in gross profit and narrowing of net losses, thanks to improved oil prices and an upturn in its trading division.

The Ukraine-focused oil and gas firm reported an average realised price of US$41.60 per oil equivalent barrel, up from US$34.5 per barrel in the preceding year.

]]> VSA Capital Market Movers - NuLegacy (TSX-V:NUG) (OTCMKTS:NULGF) Wed, 09 May 2018 09:02:00 +0100 NuLegacy ((TSX-V:NUG) (OTCMKTS:NULGF)#

NuLegacy (TSX-V:NUG) has announced that its new drilling programme has commenced with two rigs now on site. The programme is expected to cover 15,000ft (c4.6km) over 12 holes. The drilling is being targeted based on a reappraisal of the existing data and NUG are primarily targeting new and higher grade zones of gold mineralisation in the 2km area between Avocado and Serena deposits.

NUG is now targeting the juncture of the Wenban 5 limestone horizons (a known host for Carlin style mineralisation) and low angle thrust faults which act as the conduits for gold bearing fluids during formation. Previous drilling has shown that these thrust faults cut across the limestone horizons and that mineralisation may be present in both features. The reinterpretation of the existing data indicates that it is where these features meet that NUG now expect higher grade mineralisation to occur.

As we have previously highlighted NUG has adapted its approach to avoid the caving issues which affected drilling at Avocado last summer. This means first using reverse circulation drilling to get through the gravel overburden before casing the hole and following up with core drilling. The initial programme will consist of five drill holes with two in Avocado and three stepping out from Serena and the North Iceberg zones; this will then inform the latter part of the programme.

In addition to drilling, NUG will also undertake a gradient array IP geophysical survey at VIO; a volcanic hosted epithermal gold silver mineralisation. This will be carried out in late May and the technique was successfully used in the exploration of Mule Canyon; an analogous regional deposit to VIO.

NUG has budgeted C$5m for drilling and field exploration in 2018 and the announcement of the start of drilling marks the start of a key period of newsflow for the company with the potential for significant near term share price catalysts. We remain confident in the potential for NUG’s deposits and believe that the company has learnt a significant amount from last year’s exploration and the information is being used to best effect to inform this year’s programme.

We reiterate our Speculative Buy recommendation.

]]> "Smelters will be lining up to try and buy the product" says Galena Mining's CEO Wed, 09 May 2018 07:18:00 +0100 Galena Mining Ltd (ASX:G1A) chief executive Ed Turner updates Proactive Investors on the exploration and development company’s progress since it “hit the ground running” after floating on the ASX last September.

Metallurgical testing results have just been announced from the flagship Abra Project, a world-class base metals deposit with a globally significant resource of lead-silver which transitions into gold-copper rich mineralisation at depth. A pre-feasibility study (PFS) is underway and scheduled to complete in September, at which point a bankable feasibility study (BFS) will commence.

Turner explains, “what was very positive out of today's results is we're getting at least 72% lead in the concentrate plus 150-200 grams per tonne silver, so that exceeded our expectations. The average sort of concentrate on a similar type deposit might be 60% for example, and plus 70% recovery is very good. So this is highly salable product, and a lot of smelters will be lining up to try and buy the product from us."

Meanwhile, regional exploration is ongoing, with drilling active at the Woodlands copper targets within the Jillawarra Project.

]]> Canshale has big plans for its recent $20mln investment Tue, 08 May 2018 20:07:00 +0100

Canshale Corporation CEO Christopher Hopkins tells Proactive Investors about the shale oil company's latest projects.

The privately-owned company recently raised US$20mln and says its next step is to install a demonstration facility. Its Golden Plain Project in Saskatchewan was designed to produce ultra-low sulphur diesel fuel.


]]> 'Pivotal' period ahead for 88 Energy across its conventional and shale interests Tue, 08 May 2018 10:55:00 +0100 Dave Wall, managing director of 88 Energy Limited (LON:88E, ASX:88E), caught up with Proactive Investors to discuss their recent A$17mln fundraise which will be used predominantly to fund the ongoing evaluation of conventional and unconventional oil targets on Alaska’s North Slope.

Wall also talks through the imminent re-start of flow testing at the Icewine#2 well.

]]> SDX Energy makes gas discovery at LMS-1 well in Morocco Tue, 08 May 2018 08:59:00 +0100 Paul Welch, chief executive of SDX Energy Inc (LON:SDX), tells Proactive's Andrew Scott the LMS-1 exploration well in Morocco has unearthed a new conventional natural gas discovery within the 75% owned Lalla Mimouna permit.

Welch also talks through the start of drilling at the Kelvin-1X exploration well at the South Disouq project in Egypt.

]]> Permex Petroleum CEO confident shareholders will 'reap the benefit' of planned IPO Wed, 02 May 2018 13:18:00 +0100 Permex Petroleum CEO Mehran Ehsan tells Proactive Investors the junior oil and gas company plans to close the book on May 17 and be live on the Canadian Securities Exchange under the ticker "OIL" starting May 21.

Ehsan says the company plans to use the funds raised to acquire new assets at a discount, re-stimulate 46 oil and gas wells with small-asset-formula programs, bring online 33 shut-in oil and gas wells, as well as water flood five of the seven oil fields the company owns.

Ehsan says Permex will continue growth by scaling up land reserve and production per day.

]]> Chariot Oil & Gas evaluating well data after 'disappointing' result at Rabat Deep Wed, 02 May 2018 11:54:00 +0100 Larry Bottomley, chief executive of Chariot Oil & Gas Limited (LON:CHAR) discusses with Proactive's Andrew Scott the Rabat Deep exploration well, offshore Morocco, which has failed to find a hydrocarbon accumulation.

Bottomley says the well was drilled safely to a depth of 3,180 metres and while it didn’t encounter oil or gas it did penetrate a thick top seal and tight, fractured carbonates in the primary Jurassic target.

]]> Rose Petroleum brings in £1mln of new capital to support Paradox basin plans Wed, 02 May 2018 11:49:00 +0100 Matthew Idiens, chief executive of Rose Petroleum PLC (LON:ROSE), tells Proactive's Andrew Scott they've raised £1mln of new capital to support their plans in Utah’s Paradox basin.

Some £633,920 of the raise is conditional upon shareholder approval, at an general meeting that will now be convened on May 21.

The funding proceeds will be used to advance the group’s assets in the Paradox basin – it will support the completion of a new competent persons report, and, significantly, help advance key preparations to make its prospects ‘drill ready’.

]]> Point Loma Resources acquisition increases oil and liquid production by 70% Tue, 01 May 2018 19:47:00 +0100 Point Loma Resources (CVE:PLX) CEO Terry Meek tells Proactive Investors Point Loma acquired oil and natural gas liquid assets in the West Central area of Alberta in a receivership deal with a private company. The deal increases potential drilling opportunities.

The property would add net operating income of C$1.3mln annualized and adds production of around 450 barrels of oil equivalent per day.

]]> Union Jack Oil's David Bramhill feeling confident about new Wressle application Tue, 01 May 2018 10:51:00 +0100 ''It's a momentous occasion - the first time investors have had a glimpse inside Union Jack Oil's headquarters'', says David Bramhill.

Chatting to Proactive's Andrew Scott in his usual relaxed yet informative style he says 2017 was a year of “considerable progress” for them.

The onshore UK oiler's continued to grow its portfolio, both during and after the reporting period, and, Bramhill describes himself as “enthusiastic” about the future.

]]> Diversified Gas & Oil enjoying 'robust production and increasing cashflow' Mon, 30 Apr 2018 12:57:00 +0100 Rusty Hutson, chief executive of Diversified Gas & Oil plc (LON:DGOC), discusses with Proactive's Andrew Scott the company’s “remarkable success” in its first year as a public company.

“We delivered everything we said we would do at the time of our admission to AIM in terms of growing production through acquisition and subsequently provided the company with robust production and increasing cashflow''.

Reporting on the pre-acquisition period, the year ended December 31, the company revealed total revenue of US$41.8mln, up 144% from the US$17.1mln achieved in the preceding year.

]]> 'Things are adding up for Iofina' with increased year-on-year production Mon, 30 Apr 2018 10:27:00 +0100 Tom Becker, chief executive of Iofina plc (LON:IOF), tells Proactive Investors 2017 was a year of 'substantial' progress for the company.

Gross profit increased by US$2.2m from US$2.7mln to US$4.9mln while underlying earnings (EBITDA) improved by US$2.7m from a deficit of US$1.3mln to a US$1.4mln surplus.

]]> Po Valley Energy emerges from transformation with new focus Mon, 30 Apr 2018 07:16:00 +0100 Po Valley Energy Limited (ASX:PVE) chairman Michael Masterman speaks to Proactive Investors about the company's transformational year, coinciding with the release of Quarterly Reports.

Masterman says, "on the production front it's great to see that production from our gas fields is up nearly 50%, our revenue's up 54%, so that's a very significant testament to the quality of those production assets. The quarter was a great quarter operationally."

Some corporate restructuring was completed in April, with the capitalisation and spinout of Coro Energy. Masterman explains, “we'll be able to put the Coro Energy shares in the hands of our shareholders; they'll get all the upside associated with the Coro development. And meanwhile, and most importantly, Po Valley Energy then becomes a very streamlined, focused company."

]]> Pulse Oil Corp kicking off 'exciting' phase 1 of Bigoray asset Thu, 26 Apr 2018 18:36:00 +0100 Pulse Oil Corp (CVE: PUL) CEO Garth Johnson tells Proactive Investors they are kicking off Phase 1 of their Enhanced Oil Recovery project at their Bigoray asset in Alberta.

Johnson says the company is upgrading surface equipment, in preparation for the injection phase of the project. The junior oiler is conducting a number of studies and geological models including deciding how many fluids need to be injected into the pool, what injection rates should be, and the cost to conduct the program.

]]> Savannah Petroleum ‘a much more grown up business’ focused on delivering value Thu, 26 Apr 2018 08:00:00 +0100 Andrew Knott, chief executive of Savannah Petroleum PLC (LON:SAVP), discusses with Proactive's Andrew Scott the performance of the Seven Energy assets in Nigeria since acquiring them last year.

Knott also talks through their oil discovery this week in the Agadem Rift Basin, south east Niger.

Bushiya-1 is currently being suspended for future re-entry.

]]> Jersey Oil & Gas's Benitz: North Sea an exciting place to explore again Wed, 25 Apr 2018 15:31:00 +0100 Andrew Benitz of Jersey Oil & Gas PLC (LON:JOG) says pre-funding the seismic being shot over the Verbier acreage in North Sea allows the data to be optimised and is cheaper.

Capex for the appraisal programme will be at the upper end of £9-11mln including seismic.

Drilling at Verbier will see an appraisal well in the summer to firm up the recoverable oil at the discovery.

''All in all, the North Sea is an exciting place to explore again'', said Benitz.

]]> United Oil & Gas growing quickly and keen to carve out big deals Wed, 25 Apr 2018 12:16:00 +0100 Brian Larkin, chief executive of United Oil & Gas Plc (LON:UOG), introduces the company to Proactive's Andrew Scott.

Coming to the London market last July with two assets, one in the UK and one in Italy, the company's moved quickly to grow and create shareholder value.

]]> Mosman Oil & Gas confirms reserves at Arkoma and Welch projects Wed, 25 Apr 2018 11:35:00 +0100 John W Barr, chairman of Mosman Oil And Gas Ltd (LON:MSMN), discusses with Proactive Investors confirmed reserves at their Welch permian basin and Arkoma Stack Pay projects.

Arkoma's been confirmed to have gross proved and probable (2P) reserves of 336,000 barrels oil equivalent, along with 2.4mln barrels of contingent resources.

Net to Mosman, the 2P reserves amount to 64,000 boe. The company values its net 2P reserves at US$1.23mln.

Meanwhile at Welch proved reserves (1P) amounted to 234,000 barrels gross for the field. It comprises 109,000 barrels classified as being ‘Proved Developed Producing’ or PDP reserves, while the field is also seen to have 102,000 barrels of proved un-developed reserves.

]]> Wressle set to be a 'game-changer' for Union Jack Oil in 2018 Tue, 24 Apr 2018 07:03:00 +0100 David Bramhill, executive chairman of Union Jack Oil PLC (LON:UJO), brings Proactive's Andrew Scott up to date on the latest developments in the portfolio.

Bramhill says their 20% owned Fiskerton Airfield Oilfield project has resumed production, meanwhile, new efforts to secure planning permission for the Wressle field are also advancing.

]]> Providence Resources keen to move ‘aggressively’ on Barryroe Mon, 23 Apr 2018 14:08:00 +0100 Tony O'Reilly, chief executive of Providence Resources PLC (LON:PVR), discusses the long awaited and hotly anticipated breakthrough for the Barryroe project, off Ireland’s south coast.

A farm-out deal with a consortium of Chinese companies puts Barryroe on-track to become Ireland’s first producing oil field - at its peak the field could eventually produce a hundred thousand barrels of crude per day.

]]> Cash injection to help PowerHouse Energy advance waste-to-power technology Fri, 20 Apr 2018 13:06:00 +0100 Keith Allaun, chairman at PowerHouse Energy Group PLC (LON:PHE), caught up with Proactive Investors following their new equity issue - raising £900,000 of capital to support ongoing commercial development of its energy systems.

PowerHouse will use the funds for the group’s pioneering technology, which is designed to process waste plastics and end-of-life tyres into a source of energy.

]]> Rose Petroleum assembles top team ahead of Paradox Basin drilling Thu, 19 Apr 2018 14:19:00 +0100 Matthew Idiens, Chief executive of Rose Petroleum PLC (LON:ROSE), tells Proactive's Andrew Scott activity continues apace on the ground in Utah’s Paradox basin and they're expecting to drill the first well in the project later this year.

It comes after Rose increased its footprint in the Paradox basin, and as it continues to earn into a 75% stake in an 80,000 acre area.

Idiens says they've assembled a highly experienced operational team with a successful track record in the region.

]]> Iofina maintains production despite tough winter and fewer plants Wed, 18 Apr 2018 15:19:00 +0100 Tom Becker, chief executive of Iofina plc (LON:IOF) tells Proactive Investors they maintained iodine production in the latest quarter even with an exceptionally bad US winter and less plants in operation.

Two of the plants (IO#3 and IO#5) were offline at the start of the quarter, while parts of the US were hit by one of the coldest winters in living memory.

Even so, the group produced 118.2metric tonnes (118.7Mt) in the three months to March.

]]> Falcon Oil & Gas boss says fracking ‘green light’ is brilliant news for Australia Tue, 17 Apr 2018 09:11:00 +0100 Falcon Oil & Gas Ltd (LON:FOG, CVE:FO) chief executive Philip O’Quigley says it is a big day for the company, but, also for the Northern Territory and Australia.

The lifting of a moratorium on hydraulic fracturing has cleared Falcon and its operating partner Origin Energy - Falcon owns 30% of the shale project while Origin has the other 70%.

It means a five well campaign can now be advanced “as soon as practical”.

“It is brilliant news,” O’Quigley said in a Proactive Investors interview.

He added: “It is a huge resource to go after, and the lifting of the moratorium means we can get back to work.”

]]> VSA Capital Market Movers - Independent Oil & Gas (LON:IOG) Tue, 17 Apr 2018 08:01:00 +0100 Company Name (Ticker)#


Independent Oil & Gas (IOG LN) has announced that it has now completed the acquisition of the Thames Pipeline. The pipeline provides a ready built, secure and wholly owned export route for gas from the Blythe and Vulcan Satellite hubs, saving IOG significant development capital and enhancing the economics of the Southern North Sea gas project. In addition, IOG has announced that it intends to acquire the onshore reception facilities at the Perenco Bacton Terminal where the Thames Pipeline ends. A period of exclusivity has been agreed until the end of September 2018. 

IOG is now the operator of the 100% owned Thames Pipeline which at peak production is expected to carry 180mmcfd; although since this would not fully utilise the pipeline’s capacity (300mmcfd in total) IOG is considering opportunities for additional third party gas.

Currently IOG is conducting an intelligent pigging programme to confirm the state of the pipeline. However, since the pipeline was decommissioned in 2015 with an estimated 25-40 years of life remaining we expect it to be in good condition with any necessary remedial work likely to be limited in nature. Results are expected in early May. We also note a potential modification to the pipeline which is currently being considered. This could reduce the time and cost of the pigging programme by using a new tie in point for the Southwark platform which is in the Vulcan Satellites hub.

This announcement reflects a key milestone for IOG and the company continues to make strong progress towards the Final Investment Decision due in August 2018.

We reiterate our Buy recommendation and 72p price target. 

]]> VSA Capital Market Movers - Columbus Energy Resources (LON:CERP) Mon, 16 Apr 2018 07:50:00 +0100 Columbus Energy Resources (LON:CERP)


Columbus Energy Resources (CERP LN) has announced that it has agreed in principle to purchase the remaining 50% of the Icacos Field from its JV partner Touchstone Exploration (TXP LN/CN) via their respective subsidiaries; Leni Trinidad Limited (LTL) and Primera Oil & Gas Limited. LTL will subsequently become the 100% owner of the Icacos field and the operator. The Icacos Field is located at the far end of the South West Pensinsula and we believe that the transaction will enable both CERP and TXP to focus more fully on their respective strategies. 

The transaction remains subject to regulatory approval and a definitive sale and purchase agreement, however, CERP is confident that the deal will be finalised during Q2 2018. Our estimates remain unchanged whilst the transaction is finalised.

Gross production on the field was consistently around 22bopd during 2017 having peaked at 34bopd in 2011. The Field consists of six wells with three on production although new work programme activities and workovers have been limited recently. The transaction is valued at US$500,000 and will mean operatorship transfers from TXP to CERP along with the 50% share of production. This will be paid over time until 1 January 2021 with Primera receiving net revenue it would have received had it retained its interest. In the event of increased production, Primera will also receive, 25% of any net revenue above the current baseline; until 1 January 2021.

The terms of the transaction are attractive in our view enabling CERP to use existing cash resources to fund operational activities at Icacos rather than being used for upfront payment. With TXP’s current strategy focussed on infill drilling on its developed acreage and CERP heavily focussed on development of the SWP we believe that CERP is better placed to oversee Icacos Field development.

We reiterate our Buy recommendation and 26p target price.  

]]> SDX Energy's latest Egypt well 'going gangbusters' - CEO Paul Welch Thu, 12 Apr 2018 09:55:00 +0100 Paul Welch, chief executive of SDX Energy Inc (LON:SDX), tells Proactive Investors drilling at the Ibn Yunus-1X well at the South Disouq project's revealed a larger than expected gas reservoir.

Welch says the well encountered 100.8 feet of natural gas pay in the Abu Madi horizon and the average porosity was measured at 28.5%.

A production test will now take place starting 30-45 days after the drill rig is removed.

]]> Cabot Energy looking set to hit full year production targets Wed, 11 Apr 2018 11:14:00 +0100 Keith Bush, chief executive of Cabot Energy Plc (LON:CAB), tells Proactive's Andrew Scott production in April's averaged 950 barrels of oil per day, meanwhile, the measure for the first three months of the year averaged 725 bopd.

Cabot's anticipating that another 200 bopd of crude production will be brought online through the second quarter.

]]> Oil price, Hurricane, Faroe, Zenith And finally... Tue, 10 Apr 2018 08:16:00 +0100 WTI $63.42 +$1.36, Brent $68.65 +$1.54, Diff -$5.23 +18c, NG $2.69 -1c

Oil price
It’s a bit of a see-saw life in the oil market at the moment with traders having to be on their toes even more than usual. Yesterday crude oil rallied sharply as it was tariff war off and Syria war back on which switched attention back to geopolitical problems in the Middle East. This morning that trend is continuing with both grades up nearly a dollar and Brent knocking on the $70 door again.

Hurricane Energy - LON:HUR 
The final results for HUR are relatively meaningless but they hide a truly transformative year for the company as Lancaster moved into project execution phase. They also delivered two CPR’s that gave them 2.6bn barrels of 2P reserves,(a first) and 2C contingent resources (up 450%). They also raised $547m which was no mean feat under the circumstances (in joke) and are moving fast with procurement of very large bits of kit which are coming along nicely. Cash is $381m which keeps them in a very strong position to develop Lancaster. First oil is on target for 1H 2019 which will only increase the company’s strength in terms of cash flow and I remain convinced that this world class development has still not been appreciated in terms of sheer size but also as a significant milestone in the history of hydrocarbon exploration in the UKCS. Target price is still in excess of 100p.

Faroe Petroleum - LON:FPM
Faroe announce the result of the Fogelberg appraisal well this morning which confirms the reservoir sequence and lateral extent as well as proving better reservoir quality with a deeper gas-water contact. Next stop is a DST to confirm well and reservoir productivity. Fogelberg is only 18 km North of the Åsgard complex which like other recent discoveries provide efficient, convenient opportunities for hydrocarbon movement. As an aside the Norwegian Ministry has approved the development of the Fenja oil field which is 33 km South West of the Njord facility.

Zenith Energy - LON:ZEN
An operational update from Zenith this morning which is encouraging as it shows that the significant investment in new kit is starting to pay off and is already being rewarded by a record oil production revenue month in March. At the Z-21 workover in the Zardab field the new equipment and the workover rig is now on site and will shortly pull out the tubing string and cut the tubing before running in-hole with the drill bit and hopefully start production.
With this new, owned kit these operations are significantly more efficient and work is now performed by Zenith engineers and subcontractors are rarely needed. As I mentioned gross revenues in March were $490/- which is a good start to the ‘new’ Zenith and in that sentiment the company has sensibly decided to shut in a number of uneconomic wells which had extremely high water cuts. This will leave 300 b/d of more efficient production and 31 less wells to service. Finally the ESP upgrade programme continues with 11 new pumps added since February. Zenith is turning round with strong management, a good operational team that I have met and slowly admittedly but surely is getting back in shape.

And finally…
All you need to know is that it is the Noisy Neighbours v the HubCap Stealers part 2 tonight, anything might happen….

]]> PyroGenesis Canada receives 2 orders for its metallurgy systems, totaling US$1.6mln Mon, 09 Apr 2018 17:15:00 +0100 PyroGenesis Canada Inc. (TSX-V: PYR) CEO Peter Pascali tells Proactive Investors the Montreal-based company has received two orders for its metallurgy systems, totaling US$1.6mln.

The company designs, develops, and manufactures plasma waste-to energy systems that service defense, mining, and 3-D printing.

]]> Mosman Oil & Gas reports 'excellent' results from seismic reprocessing at Amadeus Basin permit Wed, 04 Apr 2018 13:57:00 +0100 Andy Carroll, technical director at Mosman Oil And Gas Ltd (LON:MSMN) tells Proactive Investors seismic processing at exploration permit (EP) 145 in the Amadeus Basin has produced excellent results.

The reprocessing of data from has confirmed the shallow multi-pay-zone anticline at EP145, similar to the reservoir zones at the nearby Mereenie oil and gas field and also revealed information at deeper levels.

]]> Additional acreage gives Rose Petroleum 'exactly what it needs' Wed, 04 Apr 2018 08:53:00 +0100 Chris Eadie, finance director at Rose Petroleum PLC (LON:ROSE) discusses with Proactive's Andrew Scott the decision to expand their footprint in Utah’s Paradox basin - acquiring a 75% working interest in an additional 3,320 gross acres.

The package is being acquired via joint venture partner Rockies Standard Oil Company (RSOC) and, including the new acquisition, the partnership now addresses some 79,577 acres in the Paradox Basin.

]]> VSA Capital Market Movers - Egdon Resources (LON:EDR), Independent Oil & Gas (LON:IOG) Tue, 03 Apr 2018 10:16:00 +0100 Egdon Resources (LON:EDR)

Egdon Resources (EDR LN) has announced a further farm out of 5% on the PEDL253 property which includes the Biscathorpe Prospect in Lincolnshire. The transaction is on the same terms as the previously announced farm outs and Humber Oil and Gas Limited (Private) will acquire 5% of EDR’s interest by paying the pro rata cost of the Biscathorpe-2 well cost plus an additional £50k (£10k per percentage point). Humber will also acquire 5% from Montrose Industries Limited (Private). The transaction is subject to approval from the Oil and Gas Authority and EDR will retain a 35.8% in the license once completed.

We reiterate our Buy recommendation and 48.5p target price.

Independent Oil & Gas (LON:IOG)

Independent Oil & Gas (IOG LN) announced full year results which showed a loss of £2.75m compared to a loss of £21.4m in 2016. Excluding impairments on oil and gas properties the operating loss was broadly in line YoY at £798k in 2017 versus £525k in the prior period. Finance expenses increased from £899k in 2016 to £1.8m in 2017. IOG reported a year end cash position of £145k, however, we note that in February 2018 the company announced the provision of a new convertible loan of £10m by London Oil & Gas (LOG) which we believe will mean that IOG has sufficient liquidity until Final Investment Decision for the Southern North Sea gas project which is due in August 2018.

IOG has made significant progress in 2017 towards the development of its Southern North Sea gas project. During the year IOG announced significant upgrades to its Reserves at the Vulcan Satellites, Blythe and Elgood along with a CPR confirming the potential at Harvey. The company subsequently committed to an appraisal well at Harvey which could provide further upside to the strong project economics of the core hub. The hub strategy is made possible by the acquisition of the Thames Pipeline which was agreed in April 2017. It provides a secure export route for gas produced from IOG’s licenses whilst saving the company significant development capital.

This year will centre around the Final Investment Decision which is expected in August 2018. Key milestones will include demonstrating the viability of the Thames Pipeline following an intelligent pigging programme and delivering an appropriate capital structure to finance construction. We expect this to incorporate debt and equity as well as gas offtake and contractor finance. Given the achievements of 2017 we believe that IOG is well placed for an important year ahead.

We reiterate our Buy recommendation and 72p target price.

To read our recent report on IOG, please click here.

]]> TAG Oil Ltd CEO reports 'encouraging' results at Pulatea-1 oil well in New Zealand Thu, 29 Mar 2018 17:22:00 +0100 TAG Oil Ltd (TSE:TAO) CEO Toby Pierce tells Proactive Investors the company has unveiled details of a "quite exciting" flow test at the Pukatea-1 well in New Zealand.

Pierce says the well flowed at a stabilized rate of approximately 276 barrels of oil equivalent per day, 74% of it being oil, and the rest gas.
Pierce says the company will have another month of testing, followed by several months of a production scenario.

]]> Touchstone Exploration to let 'the numbers do the talking' in 2018 Tue, 27 Mar 2018 10:42:00 +0100 Paul Baay, chief executive of Touchstone Exploration Inc (LON:TXP, CVE:TXP), spoke to Proactive's Andrew Scott following the release of their 2017 year-end results.

In the year, the company produced an average of 1,375 barrels of crude oil per day which marked a 6% increase from the preceding year.

Petroleum revenues increased 33% for the year, at US$32.02mln from the US$24.03mln reported for 2016.

]]> SDX Energy Inc to double production in 2018 Fri, 23 Mar 2018 11:32:00 +0000 “In 2017 we had a 100% success rate,” an ebullient Paul Welch told Proactive.

The SDX Energy (LON:SDX CVE:SDX) chief executive today reported revenues tripled in an ‘exceptional year’ that included the Circle Oil acquisition and additional assets added to Morocco and Egypt.

SDX is looking at another ‘fantastic’ year in 2018, he added.

]]> Oil price, SDX Energy, Savannah Petroleum, Sundry-Aminex-Gulfsands-Frontera-Lamprell-And finally... Fri, 23 Mar 2018 11:23:00 +0000

WTI $64.30 -87c, Brent $68.91 -56c, Diff -$4.61 +31c, NG $2.62 -2c

Oil price

After a fast and furious week, for me and the oil price, it looks like crude will end up testing important levels, WTI is close to $65 as I write and Brent is $69.21. The main reason for the strength this week has been the inventory stats which showed in both API and EIA numbers a decent draw when a build was forecast, indeed total inventories of -7m barrels this week put stocks to 1% below the crucial 5 year average.

The other positive note was struck by the Saudi Oil Minister who declared that the Opec/Non-Opec agreement will likely be extended beyond 2018 suggesting that further draw on stocks was needed. Coupled with the news that compliance was 138% in February suggested that in this, the harder part of the year, things were looking hunky dory, so to speak.

The only fly in the ointment is that the Squids have upped their oil price target to $82.50 for mid-year which worries me something rotten…

SDX Energy

Finals from SDX this morning which merely serve to confirm what a good year it was and how well 2018 has started. Understandably they concentrate on reserves, as one should, their WI of 2P reserves was 13.5 mmboe, up 45%, a very creditable performance with their existing business and the Circle acquisition delivering well. With revenues up 204% to $39.2m, on production up to 3,237 boepd up 171%, the 100% success with the drill bit last year came through to the bottom line.

And there is plenty of drilling excitement still to come, two more exploration wells will complete the Moroccan campaign, for the time being only, I am sure. Then attention focuses on South Disouq where we can expect two exploration wells and two appraisal wells with first production likely 2H this year. At NW Gemsa there were successful workovers and at Meseda two successful exploration wells plus of course the recently announced success at Rabul-5.

SDX had $30.6m of cash on the balance sheet as at 28 February this year partly as a result of favourable receivables incoming which is a big result and so SDX is fully funded for all operational needs and of course any potential acquisition opportunities that may arise. SDX remains amongst the most solid plays within the bucket list for its low cost, high margin offering and significant upside potential.

Savannah Petroleum

Full year results also for SAVP for a period in which the landmark Seven Energy transaction occurred, with completion due 2Q 2018. The deal adds 2P reserves of c. 92 mmboe and 2C resources of c. 44 mmboe, in production terms it means guidance for 2018 of 20,000 bopd. This production, which has started the year very well, encouraged the company to indicate that a dividend should be paid and $12.5m is indicated in today’s results.

Of course the original business has continued to go ahead even if the drilling campaign in Niger was delayed somewhat by the Seven asset deal. The three back to back wells are expected to be under way by the end of March as operations are well underway and the drill bit at Bushiya is ready to spin.

2017 was a good year for Savannah as its perceptive and hard working management delivered a ground breaking acquisition and kept on top of the activities in Niger. With strong and senior support from politicians in both Nigeria and Niger export routes should be available upon success at the well campaign.


Aminex announces that Eclipse Investments, part of shareholder Zubair Group, may farm-into the Ntorya appraisal area, those who read my AEX comments in the bucket list will know that this is not unexpected…

Gulfsands is de-listing but will remain an unlisted public company which will come as no surprise to anyone I imagine, certainly not me. With no capital coming into the company from outside equity, the effective owners have raised more money together and will move on more efficiently. The ultimate irony is that I suspect we are nearly at the stage when the Syrian assets may eventually come good and the investors deserve to make something back.

Frontera has announced that mobilisation of more pumping equipment and services to the T-45 well as fraccing and testing is imminent. After this the kit will move to Ud-2 and then to Dino-2 which was announced as having spudded this week as well. Having visited the company’s operations and taken a close look at the potential I think that there is every chance that at long last these assets may about to deliver.

Lamprell announced results which showed yet again that it has a feast-famine-feast existence and with the huge losses on the East Anglia One project showing in these numbers we are in the famine section at the moment. But I remain convinced that the company has the wherewithal to fight its way out and can reach the sunlit uplands again before too long. My comments on the Saudi JV recently show that this can provide profitable work and I wouldnt be surprised if there were not more contracts for the yard around the corner. Not for the first time I am suggesting that ditching Lamprell at this juncture would be wrong….


It has been a busy week for interviews, here is my Monday Podcast talking about a number of stocks.

VOX Markets podcast: Malcy on Range Resources, Columbus Energy Resources, Touchstone Exploration, Trinity Exploration, Rockrose Energy and Lamprell

And here is my CEO interview with Tony Durrant of Premier Oil…

Core Finance CEO Interview: Tony Durrant of Premier Oil

And yesterday I managed another CEO interview, this time with Nick Cooper of Ophir Energy

Core Finance CEO Interview: Nick Cooper of Ophir Energy

And finally…

It’s the dreadful international break where ‘friendlies’ happen that no one wants to play in or watch…

The cricket can be added to footy and rugby that we dont want to talk about…

Please tell me that the boat race tomorrow at 5.30 is not the highlight of the weekend’s sport…

At least be up early for the Australian Grand Prix from Melbourne, who will have the best new kit and who’s halo will be the best?


]]> Eden Research PLC keen to add US to list of markets for natural fungicide Wed, 21 Mar 2018 15:08:00 +0000 Sean Smith, chief executive of Eden Research PLC, explains the technology behind its range of naturally-derived pesticides and why winegrowers in France, Spain and Italy are giving rave reviews to Mevalone, its grape fungicide.

Work is already underway to get approval in the US as well as Australia New Zealand and South Africa, he says.

Another product, Cedroz meanwhile is under development to target soil parasites while research in how to use Eden's delivery technology in a whole range of other areas has also started, Smith tells Proactive.

]]> BOLT restructuring propels Columbus Energy into a 'different league' Wed, 21 Mar 2018 08:01:00 +0000 Leo Koot, executive chairman of Columbus Energy PLC (LON:CERP), discusses with Proactive the restructuring of the Beach Oilfield Limited (BOLT) transaction in the South West Peninsula of Trinidad.

''Up until now we've been focused on Goudron and Goudron production ... this deal gives us the opportunity to allow Goudron to do what it does ... but the big growth is in this deal in the South West Peninsula.

''What we've now achieved in this new deal is that we've got contractual relationships with the landowners as opposed to a company which is between us and the landowners ... that gives us way more security and control over what we're going to do''.

]]> Hurricane Energy, Far Ltd, Link to IGTV interview. Tue, 20 Mar 2018 10:45:00 +0000

WTI $62.06 -28c, Brent $66.05 -16c, Diff -$3.99 +12c, NG $2.65 -4c

Hurricane Energy

In an operational update released this morning HUR has announced further important progress towards the development of Lancaster as two horizontal christmas trees and the FPSO subsea control system have been delivered by TechnipFMC. These are some of the key long lead items for the development and represent an important step to enable HUR to maintain the schedule for the Q2/3 well completion and installation programme.

CEO Robert Trice said that ‘this is a significant milestone in readiness for the 2018 well completion programme and that we remain on schedule for first oil in H1 2019’.

With further operational news from the company and other operations still very much on schedule I am confident that the Hurricane story is very much still up and running.

Far Ltd

Far has announced the findings of the Independent Resources report compiled for them by RISC for the FAN discovery offshore Senegal. Key information has 2C contingent recoverable oil resources of 198 mmbbls with undrilled prospects having prospective resources of 673 mmbbls on a best estimate basis. The JV is progressing appraisal plans for the FAN South and SNE North oil discoveries with a further review due mid year. According to MD Cath Norman ‘There seems little doubt that there is huge potential to unlock more oil when these undrilled prospects are tested in the future’.

Although the Far share price has yet to respond I am yet further encouraged by this news and am sure that the addition of more hydrocarbons here will not only extend the size and life of the field but to improve yet further the long term economics of this ‘world class’ development. Shareholders should be very happy that Far has a strong cash position and as a result of the recent very impressive farm-out a very exciting well to drill in The Gambia towards the end of the year.

IGTV link

I recently did an interview with Jeremy Naylor at IGTV in which I spoke about last years bucket list and ran through a few of the new additions to the list, the link is below.

IG interview: Malcy’s bucket list gets a boost with six new stocks



]]> VSA Capital Market Movers - Wynnstay Group: 2018 AGM Statement Tue, 20 Mar 2018 10:17:00 +0000 Wynnstay Group: 2018 AGM Statement

Wynnstay Group (WYN LN), a UK manufacturer and supplier of agricultural inputs, has announced a trading update for its H1 2018 period, which runs from November 2017 to April 2018, ahead of its AGM this morning.

  • Trading for the first four months of FY 2018 described as encouraging with increased demand for most products
  • Feed demand ahead YoY; increasing fertiliser sales; improving grain volumes but margins remain under pressure; seed demand encouraging; higher LFL sales YoY in its agricultural stores

VSA Comment

In animal feed, total UK ruminant feed production across the first two months of WYN’s H1 increased 9% YoY. Although data is not yet available for subsequent months, we believe demand has remained strong, with the recent abnormal cold weather also having benefited this operation in the last few weeks, particularly with regards to sheep feed.

As a reminder, in 2013 the listed feed suppliers all received an economic boost (and a resulting increase in share price) as colder temperatures extended into March, with peer NWF Group (NWF LN) the most financially leveraged to this trend. However, it is worth noting that performance in 2013 was also positively impacted by a very wet summer 2012, which reduced on-farm silage volumes and quality (summer 2017 was wetter than average but not significantly so). So far this year, only NWF and ForFarmers (FFARM NA), the largest feed supplier in the UK, have shown any positive share price reaction.

In arable, and as we wrote at the end of January, with early estimates for the 2018 UK wheat harvest suggesting it will be 2-3% smaller than last year, we are expecting a slightly lower YoY performance for WYN’s seed business and a similar YoY performance for its fertiliser operations. WYN’s fertiliser business will also be boosted this year by its expansion into the Scottish fertiliser sector through its acquisition of a blending facility at Montrose last November.

As highlighted by WYN in its FY 2017 results, having experienced a reduction in early, out-of-season orders at the end of FY 2017, stronger fertiliser demand is now starting to come through and will increase further as farmers begin to buy in the spot market for the spring usage period.

In January, we also stated that we expected WYN’s grain trading volumes would increase this year as volumes from the slightly bigger 2017 harvest continued to be traded and farmers began to clear on-farm stocks in light of higher grain prices ahead of the upcoming 2018 harvest. WYN has confirmed this trend this morning, although margins remain under pressure.

We also suggested that WYN’s specialist retail operations would benefit from a much improved sentiment in the underlying UK agriculture market this year, as highlighted by recent announcements from peers. This is also confirmed by WYN today with improved LFL sales reported for the first four months of FY 2018.
WYN looks set for an improved FY 2018, given the improved underlying market conditions and the decisive action taken last year with regards to the closure of its Just for Pets business.

Consensus for FY 2018 is currently revenue of £405.5m, +3.8% YoY, and an adjusted PBT of £8.2m, +2.5% YoY.


]]> VSA Capital Market Movers - Egdon Resources (EDR LN)# Tue, 20 Mar 2018 10:02:00 +0000 Egdon Resources (EDR LN)#

Egdon Resources (EDR LN) has announced that it has reached a Heads of Terms agreement in respect of a farm out of interests in PEDL 253 to Union Jack Oil (UJO) and Humber Oil and Gas (Private). PEDL 253 in Lincolnshire contains the Biscathorpe project.

The terms which were previously announced as a Definitive Farm Out Agreement are unchanged with UJO and Humber to each acquire 6% of EDR’s interest in PEDL 253 by paying their share of a Biscathorpe 2 well cost plus an additional £10k per percentage point interest acquired. UJO and Humber will also acquire 4% each of Montrose Industries Limited interest in PEDL253 under the same terms. This equates to a farm in with a 1.36 times promote at the estimated well cost. The agreement remains subject to approval from the Oil and Gas Authority and EDR will then retain a 40.8% interest with a 29.31% share of the currently estimated well cost.

The mean gross prospective resources at Biscathorpe are estimated at 14mmboe. The planned well is down-dip of the crestal Biscathorpe-1 well drilled by BP in 1987 which encountered oil shows from a 1.2m thick sandstone and EDR expects the reservoir sands to thicken down-dip following reprocessing of seismic data.

We reiterate our Buy recommendation and 48.5p target price

]]> VSA Capital Market Movers - redT Secures Tidal Energy Project Order Tue, 20 Mar 2018 09:55:00 +0000 redT Secures Tidal Energy Project Order

redT energy (RED LN)#, a developer of vanadium redox flow machines for large-scale energy storage applications, has signed a partnership to be primary energy storage provider for an unnamed large-scale tidal generation project in the UK.

  • 0.6MW, 3MWh flow machine system (five hours of storage) selected by the project consortium, subject to finance and formal contract awards
  • Project expected to be delivered in 2019

VSA Comment


An encouraging large project order from RED (assuming finance and formal contract awards are secured), with its flow machine solution favoured over alternative battery solutions, given the heavy cycling, non-degrading nature of its technology. It is also positive to see RED securing an order in a sector other than solar plus storage, where the majority of its UK orders to date have been won.

This order forms part of RED’s ‘large project’ strategy for 2019 and will be fulfilled with its margin-generating Gen3 machines (to be launched in H2 2018). This order will require 40 tank unit modules - our current forecasts are for more than 1,000 tank unit modules sold to customers in 2019.

The project owner is unnamed but some of the most prominent UK tidal projects are being developed by Atlantis Resources (ARL LN), which designed, built and delivered the first phase of the flagship MeyGen tidal energy project in Scotland. ARL is currently merging with certain assets of SIMEC Energy (part of the GFG Alliance), owner of an interest in Tidal Lagoon plc, which is also developing a number of tidal projects in the UK, predominately in Wales, and internationally.

We currently have a BUY recommendation on RED with a 10-year DCF-derived target price of 22p. 

]]> VSA Capital Market Movers - Columbus Energy Resources (CERP LN)# Mon, 19 Mar 2018 09:32:00 +0000 Columbus Energy Resources (CERP LN)#


Columbus Energy Resources (CERP LN) has announced a significant update in relation to the South West Peninsula (SWP) and the successful completion of the restructuring of the Beach Oilfield (BOLT) transaction. This will enable CERP to begin a fully funded exploration programme including well reactivation in Q2 2018 on the Bonasse field as well as analysis of 3D seismic on the SWP. This is expected to be followed by 2-3 appraisal wells drilled in H1 2019, subject to results. Although the operational turnaround at Goudron is a critical part of the strategy and drives near term cashflow generation, it is the exploration potential at the SWP which provides the key catalysts for a major rerating of the stock; this announcement is therefore a significant milestone for CERP in realising its longer term strategy.

Previously CERP help a 25% equity interest in BOLT via a local subsidiary and was due to acquire the remaining 75% for cash payments totalling US$184k and the adoption of a US$1.1m loan held by BOLT. The new terms which are significantly more attractive, in our view, are as follows. CERP will make a cash payment of US$450k to BOLT as well as a US$80k payment to Petrotrin to complete the purchase of a 27.5% interest in the Bonasse field. CERP will give up its 25% equity stake in BOLT and BOLT will retain the US$1.1m loan. CERP acquires access to oil and gas rights on the SWP.

CERP will pay deferred fees of US$500k to BOLT upon development of any other field than Bonasse within the lease and a royalty of 3% on net production from a development of the SWP license (excluding Bonasse). The royalty is payable on net production in excess of 10mmboe per annum and capped at US$1.25mpa.

In addition to the BOLT transaction, CERP has signed a lease agreement with Singh’s (Cedros) Estates Limited to provide CERP with guaranteed access to 100% of the SWP for oil and gas operations until January 2019 and from February 2019 a lease which provides CERP the same rights for a further 27 years. From February 2019 CERP will pay Cedros US$70kpa (escalated in line with the WTI oil price) as well as a royalty of up to 12.5% capped at US$2m for years 1-2, at 10% for years 3-8 and reverting to 12.5% thereafter. Drilling bonuses of US$15k will be paid upon spud of each of the first three wells.

The above is fully funded from existing cash resources.

The attraction of the SWP for exploration is that it has been relatively underexplored in comparison to the broader region. CERP’s existing interpretation of the multiple prospects indicates 20-400mn barrels in place. Furthermore, since the targets can be drilled from onshore costs are expected to be modest at between US$2-4m per well.

Currently CERP already has a small amount of production from the shallow Icacos oilfield while the Bonasse oilfield is currently producing c10bopd of 23 degree API gravity oil. CERP expect to be able to reactivate as many as ten wells. Other historic drilling at Bonasse included 16 wells dilled to depths of up to 2,500ft. The only deep onshore well was drilled to a measured depth of 12,301ft found oil shows in the Lower Cruse and Lengua formations at a true vertical depth of 10,180ft. This well did not reach the Herrera Sandstone formation which leaves further undiscovered potential. SWP contributes 10p of our 26p target price despite its early stage which should highlight to investors the significant underlying potential.

The region is highly prospective due to its close proximity to the East Venezuelan Basin with which SWP shares its geology and on trend structures, offshore from SWP, have yielded discoveries in excess of 200mmbbls. We also note the recent announcement by BHP Billiton (BLT LN) which underpins the exploration potential in Trinidad. BLT has committed to testing three gas plays off Trinidad this year with a longer term objective of making oil discoveries.

This latest announcement CERP has confirmed the company’s ability to begin to realise its longer term ambitions in defining the exploration potential of the region via low cost onshore drilling. The announcement from BLT and the other interest from majors in the region underpins that exploration potential, in our view, although we highlight that their exploration is offshore. With the shares having eased back recently as the WTI oil price has pulled back from above US$65/bbl we believe that CERP’s current valuation provides a compelling entry point for investment exposure to Trinidad’s exploration upside.

We reiterate our Buy recommendation and 26p target price. 

]]> VSA Capital Market Movers - redT energy: Gen3 due H2 2018 Mon, 19 Mar 2018 08:56:00 +0000 redT energy: Gen3 due H2 2018

redT energy (RED LN)#, a developer of vanadium redox flow machines for large-scale energy storage applications, has announced that its margin-generating third generation flow machine will be available for delivery to customers in H2 2018.

VSA Comment


Having now completed its initial stack design and engaged its manufacturing partner, RED has confirmed that first deliveries of its Gen3 system will occur in H2 2018 (narrowing its previous guidance of ‘2018’).

RED has also confirmed that it expects the first pre-orders of its Gen3 system to be concluded shortly. We also imagine that some of the previous Gen2 orders will now be converted into Gen3 deliveries (as we saw with Gen1 orders when Gen2 was launched).

The company has announced that it has 195 units (€11m order value) of Gen3 pre-orders in the Final Stage of Customer Selection. This is new interest in its Gen3 product and is in addition to the Final Stage of Customer Selection pipeline announced on 5 February, which had 330 units with an order value of €18.3m.

As a reminder, Gen3 machines are expected to provide a margin of 15-25%, including various services associated with each sale, compared to 0-5% for the Gen2 systems (including services).

Aside from further sales announcements, investors have been looking for certainty as to when the first Gen3 machines will be available for customers, given its potential significant positive financial impact on the business. This announcement, alongside the Gen3 specific pre-order pipeline, should provide comfort in this regard.

We currently have a BUY recommendation on RED with a 10-year DCF-derived target price of 22p.



]]> Oil price, Range Resources, RockRose, Lamprell And finally... Fri, 16 Mar 2018 12:21:00 +0000

WTI $61.19 +23c, Brent $65.12 +23c, Diff -$3.93 n/c, NG $2.68 -5c

Oil price

The most unreliable of the three main forecasters, the IEA started to back track on its more bearish than most demand forecasts yesterday and at this rate, despite the US shale ‘torrent’, equilibrium might be achieved in Q2 of this year. Whilst they were changing their numbers they snuck in a crafty rise in world oil consumption past the historic 100m b/d number, they must have been reading back issues of the blog…

Having said that Russia is going to be on everyone’s mind for the time being, with Putin’s coronation after Sunday’s vote a shoe-in things might change but the world is hardly likely to become a more peaceful place…

Range Resources

Interims to 31/12/17 are out this morning and present a welcome return to health for Range where genuine operational focus is leading to positive results. I visited Trinidad last week and was allowed full access to all its operations and met with CEO Yan Liu and the new COO, Lubing Liu, no relation. As readers know I always think that field trips are important for two main reasons, one obviously to take a look at the assets but also to spend some time with the management and the operational leaders.

I am happy to say that Range ticked the boxes in all these areas, operationally things are picking up and specifically, as can be seen in today’s results, the Beach Marcelle waterflood is reacting positively to investment of time and money. We were also able to take a good look at the fleet of rigs which are indeed modern and in one case almost ready to go out on assignment. On the management front it was more important than usual to meet the CEO, Mr Yan Liu who as far as I know has not yet met many analysts or investors, this being the first visit to the company for some considerable time. He, and the new COO who is new in his position but not to the company, having been a non-exec until recently are clearly hands on and determined to make a success of the company.

Today’s results therefore give an indication as to how things are progressing under their charge, early doors admittedly but there are definite signs of a recovery. Operationally, in Trinidad production in the period averaged 606 b/d, up 22% which was mainly due to concentration on the waterflood programme, selective development drilling where two wells were brought on-stream, and with workovers where 130 were completed. The Beach Marcelle waterflood is a ‘vast majority’ of the company’s reserves in Trinidad and it already accounts for around 30% of production.

The recent CPR confirmed net 2P reserves of 16 MMstb and net 2C net resources of 8 MMstb which gives plenty of room for upside now that the work programme is being put into action.

In Indonesia the company are in the process of building an experienced operational team and undertaking initial geological and geophysical studies as well as preparing a suitable work programme for which a budget is being finalised. Here the CPR gives Range  confirmed net 2C contingent resources of 10.9 Bscf and 3.1 MMstb. The company has a fairly undemanding set of work commitments and I expect that they will easily pass through them as they re-initiate production in this area.

The RRDSL acquisition gives Range a Trinidad based fleet of modern drilling rigs, workover rigs and equipment that will reduce costs and provide ‘operational flexibility’ as well as expand its third party client base. We saw rig 19 ready to go onsite and I noted that the drilling manager had already made some very smart adaptations so that it could be used in tight locations with a smaller load of kit if needed, often the case here. Rig 16 is a more powerful rig and could easily be moved elsewhere in the Caribbean or nearby Latin America as it can easily handle a +13,000 foot drill, deeper than normal on Trinidad. We also saw a number of workover rigs either working or on warm stand-by all having been used recently either by Range or for other local drillers, the fleet is more modern than almost anything in the region and whilst margins could be better will provide very useful ‘flexibility’ as they say.

On the numbers things are also looking up, there is a 77% reduction in pre-tax losses to $8.5m, revenues are up 39% to $5.4m and with opex down 14% to $34.50 a barrel and G&A down 40% things are moving in the right direction. Cash is $10.9m down after recent spending and for the first time in a while the CFO hasn’t had to report an impairment charge.

It has been a long haul but much went on when the shares were suspended last year, as the operational success in Trinidad continues, Indonesia starts to see some action and RRDSL gets some 3rd party work should easily see Range be back on the right road.

RockRose Energy

RRE has commissioned ERC to evaluate existing upside potential for the Blake field and its nearby Tain satellite discovery ‘with a view to inform FID on Tain development’. RockRose has also commissioned Crondall Energy to review the FPSO options on the Blake and Ross field where options are to either replace the vessel or to to extend the life of it.

The interesting point of this announcement is to point out that whist RRE continues its policy of acquisition driven growth it has also seen upside potential through organic growth. The last time I spoke with the management they pointed out that the life of every asset that they owned has been pushed out by at least a year by the operator since acquisition thus giving yet more value to shareholders, what’s not to like…


An update from Lamprell today that indicates that all is going well at the JV in Saudi Arabia and that IMI is now fully in business. Construction is underway at the maritime yard at Ras Al Khair for which Lamps has already paid its initial cost of $20m of a total of $140m. Things should really start to motor for the company as ARO drilling are committed to ordering 20 jackup rigs from the yard over the next ten years, whilst construction is underway ‘significant component parts of the first 2 rigs are expected to be subcontracted to Lamprell’s UAE facilities’.  This announcement is very important in that it looks like any lingering doubts about the JV should now be dismissed. As for current trading that is a different thing altogether to be discussed at the forthcoming results meetings…

And finally…

The draw for the Quarter Finals of the Champions League has been made and – you’ve guessed it the Noisy Neighbours and the HubCap Stealers have been drawn together….

This weekend we are back to the FA Cup QF’s in which the Swans host Kane-less Spurs and the Seagulls go to the Theatre of Nightmares and after the Sevilla disaster they must feel they have every chance. On Sunday the Latics host the Saints and Chelski go to the Foxes.

The last round of the Six Nations is tomorrow with Ireland expecting to celebrate St Patrick’s day with a win over hapless England at Twickenham. Elsewhere Italy host Scotland and Wales host France.

My Moto GP correspondent informs me that the new season starts this weekend under floodlights in Qatar..

And of course, saving the best until last this afternoon sees the Cheltenham Gold Cup, the blue riband event of the jump racing season.


]]> Tlou Energy’s Tony Gilby in Botswana to advance grid connection discussions Thu, 15 Mar 2018 12:46:00 +0000 Tlou Energy Ltd's (LON:TLOU) Tony Gilby updates Proactive's Andrew Scott on the re-tendering process with the government in Botswana.

Gilby adds the company is 'critical' to the development of greener energy and energy security in the country.

He mentions the company is also looking toward combining some solar energy generation in addition to its gas operations in the country.

]]> Oil price, Savannah Petroleum-CEO Interview And finally... Thu, 15 Mar 2018 10:27:00 +0000 WTI $60.96 +25c, Brent $64.89 +25c, Diff -$3.93 n/c, NG $2.73 -6c

Oil price

A modest rally yesterday with some good and some bad news in the market. The good news was the announcement that February Opec production fell again, this time to 32.2m b/d which is indeed impressive even if Venezuela continues to involuntarily help out the cause.

The EIA inventory stats were, as expected here, poor, this time of the year US refineries are not falling over themselves to buy crude during routine seasonal maintenance and the 5m build was twice what the teenage scribblers expected. However, the American driver always comes to the rescue and any signs of Spring tempts them into the gas guzzlers and gasoline demand rocketed, drawing 6.2m barrels the highest for many months.

Savannah Petroleum- Andrew Knott interview

Yesterday on Core Finance in my CEO interview I spoke with Andrew Knott of Savannah Petroleum. This was an interview I had been waiting for for some time, indeed pretty much since the Seven Energy deal was announced. Now that the deal is almost complete Andrew kindly shared some time with me to answer some of the key questions that arise from that deal, as well as the resumption of the drilling programme in Niger which was halted whilst the shares were suspended.

The link to the interview is below and I think that is gives some very strong support to my view that the acquisition of the Seven assets along with the impending drilling campaign in Niger will be highly beneficial to Savannah shareholders.

Core Finance CEO interview: Andrew Knott of Savannah Petroleum

And finally…

In the Champions League Chelski had it all to do away in Barcelona and when King Lionel scored in the 3rd minute it just got that much harder. Antonio Conte said afterwards that the result was ‘unfair’ but the little maestro made all the difference.

In the Boropa Cup tonight the Gooners host AC Milan and you would have thought that even Wenger’s men can’t mess this one up….

]]> Touchstone Exploration pushing ahead with 2018 drill programme Thu, 15 Mar 2018 07:50:00 +0000 Paul Baay, chief executive of Touchstone Exploration Inc (LON:TXP, TSE:TXP), tells Proactive Investors they've optimised the wells drilled in 2017 as well as updated on the 2018 drill programme.

Oil sales averaged 1,521 and 1,552 barrels per day for the months of January and February respectively, at average prices of US$61.17 and US$57.79 per barrel.

Baay says the four wells drilled last year have maintained strong production with the new wells yielding an average of 280 bopd.

Field production is currently seen at around 1,705 bopd, and the batch of new wells are flowing around 400 bopd.

]]> Europa Oil And Gas looks to fast-track 'flagship' Inishkea prospects Wed, 14 Mar 2018 10:23:00 +0000 Europa Oil And Gas PLC's (LON:EOG) Hugh Mackay tells Proactive's Andrew Scott that the Inishkea prospects are now the company's 'flagship' project in Ireland.

He says a 2019 drilling date is possible, with the lower geological risks of the area a compelling reason to pursue the project.

Mackay adds that the project could also help reduce the reliance of Ireland on gas imports from countries such as Norway and Russia.

]]> Active Energy inks CoalSwitch joint venture with Polish group Cobant Tue, 13 Mar 2018 15:25:00 +0000 Richard Spinks, chief executive of Active Energy Group PLC (LON:AEG) and Jakub Szałatkiewicz from Cobant, discuss with Proactive's Andrew Scott a new joint venture between them which is focused on a new "Super Fuel" - combining CoalSwitch and reclaimed coal from slurry dumps in Upper Silesia.

The JV will assess the best ratio for a combination of reclaimed coal and Active Energy's wood-derived CoalSwitch biomass alternative.

Sales initially will be in Poland but eventually roll-out across the European Union and central Europe both for power stations and domestics users.

]]> Oil price, Cairn Energy And finally... Tue, 13 Mar 2018 09:41:00 +0000 WTI $61.36 -68c, Brent $64.95 -54c, Diff -$3.59 +14c, NG $2.78 +5c

Oil price

As I mentioned yesterday crude oil was marked back first thing and never recovered, probably ahead of an uncertain week of inventory stats. At this time of year analysts are usually over optimistic as they miscalculate the effect of refinery maintenance so lets see what the API and EIA say before getting carried away.

Cairn Energy

Full year results from Cairn this morning which contain no great surprises, nor should they in this era of constant updates from companies. The statement is primarily about Senegal and so it should be as so much is going on there at the moment. Much work is under way with tenders out for the FPSO and subsea infrastructure and the FEED is set to commence 2H 2018. Change of operatorship is now scheduled for 2H as well which has presumably been pushed back until after the arbitration case has been settled.

The exploitation plan is set for submission in 2H 2018, to be followed by the FID. First oil is still aimed at 2021-2023 which is a wide range but clearly dependent upon various unknowns. Cash is only $68m although the potential  RBL pot is very substantial but may be needed given the development expenditure required for Catcher and Kraken, Senegal and the exploration budget. Having said that and given the potential substantial increase in revenues to come the financial position is strong. I shall not bang on about it much more but I still believe that a partial sale of Senegal was, and probably still is, a live and wise option for Cairn as they look at the bills running through to first oil, potentially still five years away. Nevertheless Cairn is in a strong position, in charge of its own destiny, financially sound and with a portfolio of exciting prospects.

And finally…

Last night the Noisy Neighbours went one stage closer to claiming the title with a 0-2 win at the Potters who are  not that safe at the moment. Tonight Sevilla visit the Theatre of Dreams in what should be a proper, old fashioned night of European Cup football.

But most of all today sees the start of the Cheltenham festival and for the first time in heavy conditions so none of these lightweights trotting up with the sun on their backs…With 250,000 visitors and £350m to be wagered, never mind all that Guiness that won’t drink itself punters headed for the  course will have a great time

]]> SDX Energy, Pantheon Resources Fri, 09 Mar 2018 14:43:00 +0000 SDX Energy

Heading home and have spotted the announcement from SDX which details a gas discovery at the SAH-2 well on the Sebou permit in Morocco. This makes a success rate of 5/7 and here the company found 5.2m of net conventional natural gas pay across two zones in the Guebbas and Hoot formations with a porosity of 33%. The well came in on prognosis but the reservoir thickness was above pre-drill expectations. The well benefited by being the first time that the company has used downhole directional tools and it penetrated two targets with a single well bore. I hope to add to that after speaking to Paul Welch on my return.

Following my trip to Morocco I certainly came away even more positive about SDX if that was possible and this news is very encouraging in terms of the plan to increase production to 8-10 MMscf/d by the end of this year. With costs extremely low and gas prices increasing towards $10 and then $12 the outlook for the company is extremely bright as they move to Lalla Mamouna for two exploration wells.

Pantheon Resources

In the lounge and running out of time I have just seen the PANR announcement. I will cover in much more detail on Monday when I have spoken to Jay but I am highly encouraged by the news. Clearly there are some mixed messages but at the 5 well it looks very promising and they appear to be getting to the bottom of the seemingly endless operational problems at VIBM#1. Over at the 4 well the sidetrack has been non-commercial but they may re-enter with a horizontal lateral. News that two separate US groups have approached them to explore possibilities in the Wilcox is very promising indeed. More on Monday when I return home and speak to Jay….

]]> SDX Energy confirms new gas discovery in SAH-2 onshore Morocco Fri, 09 Mar 2018 12:19:00 +0000 SDX Energy (LON:SDX) chief executive Paul Welch updates Proactive Investors on the new gas discovery at its SAH-2 well.

SAH-2 was drilled down to 1,304 metres and has encountered some 5.2 metres of net conventional gas pay, across two zones (Guebbas and Hoot)

Welch says they're now moving north to drill two exploration wells - the final two in their 9-well campaign.

]]> Cadogan Petroleum increasing production and pursuing new opportunities Fri, 09 Mar 2018 08:29:00 +0000 Guido Michelotti, chief executive of Cadogan Petroleum PLC (LON:CAD), says the company has seen increased production at its wells and is reviewing new growth opportunities.

Cadogan is reporting that production had nearly doubled at its  Blazhiv 1 well in West Ukraine.

Having acquired Explo Energy in Italy last year they're now looking at other opportunities in Africa, the Middle East, and Central Asia.

]]> Diversified Gas & Oil completes on Alliance Petroleum acquisition Thu, 08 Mar 2018 15:53:00 +0000 Rusty Hutson from Diversified Gas & Oil (LON:DGO) tells Proactive daily gas production has doubled following the acquisition of Appalachian Basin gas producer Alliance Petroleum.

The deal has now completed for a total consideration of US$95mln (£66.9mln) comprising the purchase price of US$70mln plus US$25mln of debts.

Hutson also says the planned acquisition of CNX in on track to be completed by the end of March.

]]> Ophir Energy, Premier Oil Thu, 08 Mar 2018 14:15:00 +0000 Ophir Energy

I spotted Ophirs figs from my hotel yesterday and am looking stone wrong on this one after a reasonable set of figures were hijacked again. So, reserves up (13%), funds flow from production up (46%), reduced G&A(17%), increased liquidity (57%) and delivered NAV growth (6.4%).

But, and it’s a big but, no delivery of Fortuna which is ‘a priority’ I bet it is….. Otherwise it all looks ok as they are well enough funded, subject to no Fortuna nightmares and Bualuang and Kerendan fields are set to do the job and despite a much reduced exploration budget opportunities still exist in Equatorial Guinea (Yes!) and Mexico.

I met with Nick Cooper a couple of months ago and came to the conclusion that my long held bearish stance should be reversed, how wrong I was but I still believe that I did it for all the right reasons and am now in no mans land. The good thing is that Nick has agreed to come on my CEO interview slot on Core Finance in a couple of weeks and chat about Ophir, watch this space…..

Premier Oil

Results today from Premier who have confirmed all that we already know which is what finals are all about, the day that something new or unexpected turns up it’s time to worry.

Production wise it’s 75/- boepd (71,4) and Catcher came on stream on time and under budget at Christmas and will deliver a small present by eventually producing 60/- boepd. Thus guidance is a very conservative 80-85/- boepd but then these are promises made to be broken.

Elsewhere, Tolmount funding has been secured in an innovative way as befits a company with $2.7bn of debt and the impressive Zama discovery in Mexico (600 mmbbls gross) is still on the books and will see appraisal drilling 2H of this year. In SE Asia demand for gas has been strong especially in Indonesia from Singapore buyers and Vietnam also saw impressive operational performance. Prices remain solid if flat but the days of big highs and low lows appear to be over.

Sea Lion, I knew you would ask about that but nothing has noticeably changed although much must be going on behind the scenes. Discussions are still continuing with senior debt providers and supply chain contractors to ‘secure suitable funding and commercial terms’. All this adds up to a FID ‘ by the end of 2018 which smacks of further dawdling in the hope that the fairy godmother pitches up with a wad of cash. The scenario however remains the same, on the one hand the ‘senior debt providers’ they mention are unlikely to have their hands out proffering cheap moolah but on the other, as Prems point out, SL is the company’s largest pre-development project and by, say, 2023 if sanctioned would be a meaningful part of the business. With a decent combination of senior debt and a host of lower debt and supply chain contributions it should go. Rocks and hard places come to mind but to me the bottom line is clear, the economics of the project have got significantly better and at $60 ish it must be a runner, also whilst not really wanting to lend any more PMO is in my view dependent on the Falklands and the sooner they get on with it the better.

Financially the company report disposals of $300m in the year which is a tiny step but of course is how all journeys start. Reserves and resources are 902 mmboe (835) with opex of $16.4/boe being an impressive show of work in the last three years.

So, where does that leave us, in my view in a surprisingly good position looking forward over the next five years or so. Cash flow at say, $65 could finance and even reduce  debt substantially, deliver the key projects and have a company with 100/- bd of production to feed those hungry mouths. Premier therefore stays in the bucket list and I have Tony Durrant back in my CEO interview slot in a few days time, we shall what he can add to today’s numbers.

]]> Trinity Exploration & Production Tue, 06 Mar 2018 11:49:00 +0000 Trinity Exploration & Production

Another blog from far flung lands will keep you informed from Trinidad .

2017 financial highlights from TRIN this morning which I’m glad to say are in line with my expectations with operating profits up 74.6% to $11m (6.3) and more importantly in my mind operating margins of 24.3% (17.7), this is equal to $12 pb (6.7) and reflects the positive nature of my most recent comments. TRIN has reported ‘robust’ breakeven costs of $30.9 pb and has cash of $11.8m and net debt of $0.1m. Also, cash due to the Inland Revenue and the Energy Ministry is down substantially and below the amount envisaged in the ratified payment plan.
2H production growth was 10.2%, a very impressive figure wherever you are coming from and reflects excellent operational work with work overs, re activations, swabbing and re completions in full swing. Current production short term production targets are 2,800-3,000 bopd which augurs well for the future.
Trinity’s attraction has always been that it is set up to be a low cost, high margin play and with further onshore drilling to come will give the medium term production, as if it needed it, further growth.
CEO Bruce Dingwall says that 2017 was a ‘transformational year’ and that the ‘r’ word (restructuring ) has now been retired to the lexicon which is good to hear. Investors can now expect a scaling up and as he says, spinning off the flywheel by leveraging up the P&L to enable longer term growth to kick in.
Trinity has an enviable production growth already and increasing that at the margins they expect

]]> Union Jack Oil sees 'game-changing upside' in Biscathorpe after upping stake Mon, 05 Mar 2018 13:14:00 +0000 David Bramhill, executive chairman of Union Jack Oil PLC (LON:UJO) tells Proactive the company's increased its stake in the drill-ready Biscathorpe prospect ahead of an exploration well in mid-2018.

The deal was agreed in tandem with Humber Oil & Gas, a private company, which is teaming up with Union Jack through a new commercial tie-up focused on acquisitions.

]]> Oil price, Amerisur, Frontera, Sundry-Saffron-RKH-JOG-ECO-President-RBD- And finally... Fri, 02 Mar 2018 15:54:00 +0000

WTI $60.99 -65c, Brent $63.53 -90c, Diff -$2.84 -25c, NG $2.70 +3c

Oil price

Oil will end the week down after a series of events but mainly due to the EIA inventory stats that surprised the teenage scribblers that pass for analysts on Wall Street. If they had been around last year or the one before that, or the one before that they will have remembered that as we approach March so does the Spring maintenance season and with it a fall in refinery runs and thus demand for WTI. The rise in gasoline stocks by 2.5m was also a surprise for the market but at least distillates drew.

Amerisur Resources

Monthly production numbers from AMER were almost  in line with expectations, a daily average of 6,749 bopd with a peak of 6,960, whilst the OBA saw 5,424 and 5,939. These numbers are down slightly but only temporarily, due to a workover on Platanillo-6 which will take around 300 bopd off the schedule until the middle of March.

The company has also announced that on 20th of February the 2 millionth barrel went through the OBA, this was a saving of $20.3m in the fifteen months of operation. With the OBA costing $18m to build and reducing transport costs from $14.05 to $3.90 and operating opex of $15 per barrel,  the pipeline has paid for itself after just 15 months of operations and is set to increase the cost savings as production from the Putumayo increases.

At anything over $60 Amerisur is making proper revenues and it needs not many of its dozen planned wells to come in to increase that number by a meaningful amount. It would not be beyond the realms of possibility to assume that the company might decide to do what the market has failed to do recently and reward shareholders who have been more than patient.

Frontera Resources- Georgia on my mind…

I have recently visited Georgia where I met with all levels of local management and also spent a day visiting the operations at the Taribani field including the currently operating T-45 well. I will write more about my time with the company when this well has completed and the final details are known but my visit was perfectly timed as every sign is that this well, and therefore quite possibly all three in the programme, may have a meaningful implication for both FRR and Georgia.

Tuesday’s announcement from T-45 was in itself very positive with news of the completion of open hole well logging which had deepened the well to 2,700m. The oil stained cuttings at 2460-2475m were confirmed to be within a 14.9m combined pay interval of Zone 13, further good news. This is a further developed pay section in addition to the original Zone 9, 14 and 15 targets and it should be remembered that Zone 13 was not included in the base case when the reservoir modelling was done.

The casing should now have been set and I would expect the rig to be de-mobilised in the next few days so that the well can be perforated and the frac job can be started, after which time production can be ascertained and oil from the appropriate zones can be co-mingled and brought to surface. Although nothing can be taken for granted at this stage, it is clear that very ‘live’ oil flowed back in substantial quantities with the mud and that it is therefore highly likely that this well has indeed exceeded management’s expectations.


In my absence this week a number of companies have made announcements, here are the highlights.

Saffron Energy updated the market on its progress in SE Asia and announced that it was withdrawing from the PO Valley acquisition. In the former the company says that it is ‘reviewing and negotiating a number of substantial and highly prospective opportunities in SE Asia that are consistent with its multi-TCF exploration strategy’. In the latter it appears that the deal has been called off ‘at mutual agreement’ due to regulatory and tax issues and to avoid upfront dilution.

Rockhopper updated on its Greater Mediterranean portfolio by announcing improved production from Abu Sennan with net to RKH production of 880 boepd. Pricing here is good with local realisations a small discount to Brent. A four well programme is planned this year across Abu Sennan and El Qa’a Plain. Finally Egyptian receivables have been significantly reduced with all liabilities to Beach Energy now satisfied.

Jersey Oil & Gas has announced that a rig contract has been signed for the Verbier appraisal and it and potentially a sidetrack will be drilled this summer. Starting from a base of 25-130m barrels of oil equivalent there must be huge potential upside for JOG which carries none of this in the current share price. Any validation of nearer the top of this range would surely move that price by a significant amount.

Exxon has announced a 7th significant discovery offshore Guyana at its Pacora-1 well. Eco Atlantic was quick to point out that this was the closest well to their own Orinduik block and that Exxon has signed up a second rig for exploration in the area.

President Energy announced this week that it was to obtain a secondary listing on The Bolsa de Comercio de Buenos Aires, the Argentinian Stock Exchange. Being an Argentinian listed company as well  will help significantly attract investors both institutional and private who are looking for high growth companies operating in country.

Reabold Resources has announced that it has raised up to £7.33m at 0.6p to exploit a number of opportunities that ‘have the capacity to provide significant returns on investment’. Whilst I was expecting a much larger raise I understand that new institutional shareholders have come in and existing ones have stayed. With the company’s determination to maintain price discipline and with the ability to pick and choose its investments over the coming months they decided not to accept what was a long order book at lower prices.


My recent Core Finance CEO interview with Edward Bowen of EPI Group was in the bucket list edition of the blog, for those who missed it I am putting the link below.

Core Finance CEO interview: Ed Bowen of EPI Group

And finally…

The Gooners must be sick of the sight of the Noisy Neighbours but equally aware of their generosity of stopping after just three goals when they meet. On Sunday the next fodder will be Chelski who visit the Etihad, the Gooners meanwhile visit the Seagulls who should provide some respite…Spurs host the Terriers which should be straightforward as should the HubCap Stealers who entertain the Magpies. The Swans host the Hammers and Burnley entertain the Toffees whilst the Red Devils visit the Eagles on Monday night.


]]> Mosman Oil & Gas ups stake in Arkoma project in Oklahoma Thu, 01 Mar 2018 13:52:00 +0000 Andy Carroll, technical director at Mosman Oil And Gas Ltd (LON:MSMN), tells Proactive they're exercising their right to buy into the Arkoma oil project in Oklahoma.

Through a series of deals and amendments the company ends up with a 27% stake in the project.

In the field, the project partners will now work to generate production and cash flow while longer term plans will be considered for the projects next stage of development.

]]> Haydale Graphene has the 'building blocks in place for growth' Thu, 01 Mar 2018 13:05:00 +0000 Ray Gibbs, chief executive of Haydale Graphene Industries PLC (LON:HAYD), tells Proactive he's expecting revenues over the next twelve months to rise following a period of investment and expansion.

Revenues in the six months to the end of December 2017 rose by two-thirds to £2.49mln with commercial/non-grant income 85% higher at £2.04mln.

Gibbs says they've been investing heavily in its Taiwanese operation following October’s £9.3mln fundraise, formulating ink samples to potential customers' specifications for the US$15bn self-monitoring blood glucose market.

]]> Solo Oil raises £2mln with plans to increase stake in Horse Hill Wed, 28 Feb 2018 11:42:00 +0000 Neil Ritson, chief executive of Solo Oil PLC (LON:SOLO) discusses with Proactive their £2mln share placing and plans to acquire an additional stake in the Horse Hill oil project in southern England.

Solo's agreed a deal with Primorus Investments Plc to acquire a 5% stake in the HHDL vehicle which owns 65% of Horse Hill.

The transaction increases Solo’s holding in HHDL to 15%, giving the company an effective 9.75% interest in the underlying oil project.

]]> Haydale targeting Japan’s electronic printed inks market Tue, 27 Feb 2018 17:31:00 +0000 Ray Gibbs, CEO of Haydale Graphene Industries PLC (LON: HAYD) tells Proactive Investors at the Graphene for U.S. Conference in New York, that America is trying to catch up with graphene commercialization, while the Asian graphene market pushes for the material.

Haydale's Taiwan-based inks arm has agreed a deal to supply Japanese firm Graphene Platform (GPC), and will initially target Japan’s electronic printed inks market before spreading further across Asia.

]]> Chariot Oil and Gas to raise more than £15mln to add second well to campaign Tue, 27 Feb 2018 08:15:00 +0000 Larry Bottomley, chief executive of Chariot Oil & Gas Limited (LON: CHAR), discusses with Proactive's Andrew Scott their intention to raise more than £15mln through a placing and open offer to allow them to add a second well to their 2018 exploration campaign.

Bottomley says they're keen to test Prospect S, offshore Namibia.

This will be in addition to the 10% owned Rabat Deep exploration well, offshore Morocco, which will be drilled later this year by Eni.

]]> New debt facility 'a big win' for Diversified Gas & Oil Fri, 23 Feb 2018 08:16:00 +0000 Rusty Hutson, chief executive of Diversified Gas & Oil plc (LON:DGOC), tells Proactive they've negotiated a new US$500mln debt facility at less than half the cost of their previous arrangement.

The five-year senior secured revolving credit facility has been led by Key Bank and will carry an interest rate of Libor + 2.5%-3.25% compared to Libor +8.5% currently.

]]> Exciting time for Eco (Atlantic) as it passes on first seismic data to Total Thu, 22 Feb 2018 09:04:00 +0000 Eco (Atlantic) Oil & Gas Ltd (LON:ECO CVE:EOG) CEO Gil Holzman tells Proactive they've forwarded on the first batch of seismic data shot by Tullow Oil (LON:TLW) over the Orinduik field.

French giant Total has an option to take a 25% working interest in Orinduik from Eco for a payment of US$12.5mln.

]]> PowerHouse Energy signs new deal with Wrightbus Ltd Wed, 21 Feb 2018 12:25:00 +0000 Keith Allaun, chairman at the waste-to-Energy specialist PowerHouse Energy Group Plc (LON:PHE), talks Proactive's Andrew Scott through their deal with Wrightbus Ltd, a company that builds innovative hydrogen powered buses.

The memorandum of understanding is expected to lead to a definitive deal for a venture with Powerhouse supplying its Distributed Modular Gasification (DMG) system and Wrightbus supplying hydrogen fuel powered buses.

]]> Tlou Energy 'in a great position' after significant increase in Botswana gas reserves Wed, 21 Feb 2018 10:19:00 +0000 Tony Gilby, managing director of Tlou Energy Limited (LON:TLOU), discusses with Proactive's Andrew Scott their huge increase in reserves at the Lesedi and Mamba coal bed methane projects in Botswana.

Proved and probable reserves (2P) jumped 944% to 40.8 billion cubic feet (BCF) 3.9 from BCF, while the less certain 3P category rose by 63% to 426.6BCF from 261.1BCF.

]]> Oil price, Frontera Resources And finally... Tue, 20 Feb 2018 10:49:00 +0000 Oil price

IP Week started more with a whimper than a bang, what with the US shut for GW’s birthday it seemed that traders were focused more on the cocktail circuit than the oil price. That combined with WTI for March expiring (price above is April) and the Chinese New Year also claiming numbers, trading was always going to be a bit thin. As it was the Opec Secretary General rode to the rescue announcing adherence of 133% which did the trick and oil dutifully rose.

The sight of the first ever fully laden VLCC leaving port in Louisiana with US crude destined for China was, if only for historic reasons, most interesting. The fact that the ship was Saudi registered maybe ironic, but another first was such a ship coming into and leaving a US port fully loaded shows how US import/export trade in crude oil has changed lately. With the trader being Royal Dutch Shell and the buyer being Sinopec it was a right little international event….

Frontera Resources

News from T-45, the first of a three well drilling programme at the Taribani complex in Block 12 in Georgia where TD has been reached at 2,700m in the Eldari formation. A lot of news was crammed into the RNS, multiple oil and gas shows were found most notably as follows. Oil stained cuttings were found at 2,460-2,475m in zone 13 with a formation gas kick at 2,535m in zone 14 reducing mud weight materially indicating a highly charged hydrocarbon formation.

Gas was detected at surface while drilling at 2,565-2,575m in zone 14 and ‘significant gas shows’ were recorded between 2,630-2,650m in zone 15. Here they also had a major gas kick at 2,633m after which they initiated hydrocarbon flowback operations which resulted in 383 b/d of flowback with bottom hole  pressure of 7,500 psi being recorded. Further down they were to encounter oil shows with associated gas and a ‘significant’ gas kick between 2,685-2,695m with psi of 7,800. Next stop wireline logging and analysis until which the company correctly caution initial indications should be treated with caution.

CEO Zaza Mamulaishvili said that ‘very encouraging early indications of a highly charged hydrocarbon formation are an exciting opportunity to develop zones 14 and 15 of the Eldari formation’ whilst of course the already proven zone 9 has considerable promise.

I am highly encouraged by these results and whilst they are only preliminary, feel that this well has made significant progress which may well be borne out by testing. I am looking forward to visiting the site next week and meeting local management, I couldnt have picked a better time and remain very positive about Frontera where the current price is tiny compared to the potential if this campaign is successful.


Here is the link to my Podcast from yesterday.

VOX Markets podcast: Malcy covers Hurricane Energy, Faroe Petroleum, Saffron Energy, Reabold Resources, United Oil & Gas, Upland Resources and Baron Oil

And finally…

The latics did what most Premier sides have failed to this season and beat the Noisy Neighbours 1-0 to get in the FA Cup Quarter Finals and a tie against the Saints. A right royal cup tie with a disputed sending off and scuffles in the tunnel.

Tonight its the Champions League where Chelski play Barca, ooh err…..


And thanks to all those who have kindly donated, Netty’s page is below.

]]> Oil price, Zenith Energy, EnQuest, Sundry-RockRose-Baron Oil- And finally... Tue, 20 Feb 2018 08:49:00 +0000 Oil price

Last week WTI was up $2.48 and Brent +$2.05, it didnt feel that good but the heavyweights came in from Opec and Non-Opec and lifted the gloom. The final piece in the jigsaw was the Saudi Energy Minister stating that they would prefer to keep the market short than the other way around, marginal barrel and all that as we have discussed. If that means what is says, and the agreement stays in place for at least all this year then it is realistic to assume some degree of consistency in the oil price.

The overall rig count on Friday was unchanged at 975 with oil units up 7 at 798, the US cannot be a swing producer or even decide the price of the marginal barrel the last time I looked…

Zenith Energy

An operational update from Zenith this morning where the workover programme in the Zardab Field is what can best be described as challenging. The Z-21 workover has seen the coiled tubing intervention successful but there is more to do and this should complete in April after new kit arrives in country in March. At the Z-28 workover, again much work has been completed, leaks have been sealed and the well cleared down to 3583m, but with the aim being to clear to 3944m that will be completed after the Z-21 when that kit is available.

The company has been upgrading its A-80 workover rig to increase its capabilities and will be able to use it much more regularly, this coupled with the recent purchase of the A-100 truck mounted rig in January, which is being constructed nearby, should arrive in late April.

The ESP upgrade programme has increased from 11 to 13 wells of which 7 have already been installed, these pumps uplift production and reduce downtime but there is a delay on the delivery of the next six units, accordingly Zenith has arranged another supplier with delivery in May. With current production of 350 b/d and a higher than expected natural depletion rate having been exacerbated by loss of wellbores in some primary targets, (due to uncemented casing collapsing) when rehabilitation starts there should be significant upside in production levels. Accordingly the production target of 1,000 b/d is still intact but now is planned for by this year end.

I met with COO Mike Palmer when I visited Zenith recently and he is a first rate operations man, he and his team have clearly learned a lot from this process where the workovers were not ‘as historical information had led us to believe but our view of the quality of the geology and the opportunity presented by these wells remains unchanged’. With a good quality team and plenty of new kit, these recent problems should soon be behind them  and are of ‘little material consequence when considering the longer term, very significant, prize at hand, and the broader picture of our profitable oil production activities in a field with vast, untapped oil reserves’. It is for these reserves that I believe will mean that Zenith should be able to deliver the goods in the coming months.


An update from EnQuest today that some people thought might not happen….The news is unsurprisingly getting better, production last year was 37,405 boe/d and with Kraken steaming ahead guidance for this year is 50-58,000 some 33-55% up. Kraken was 35/- bop/d in January and is on track for its 50/- bop/d target and producing much needed cash flow, even debt is starting to be paid down, net debt is now $1,989m.


After my mistake last week RockRose really has returned to the market today and has traded between 340-390p which is a very pleasing result for backers.

A very interesting move by Baron Oil who have taken an option to farm into the North Sea block that contains the very exciting Wick prospect. Drilling here is expected to be in September of this year at a cost of £4.2m, Baron are paying 20% of well costs plus £6,500 of back costs for a 15% interest in the licence.

The Market Timing Report

I thought that this offer, exclusive to blog readers might be of some interest. I have subscribed to this service for over two years and find it an invaluable help, as an amateur chartist you will understand, very much worth a look. Andy Pancholi of Cycles Analysis has kindly offered to continue this one-off deal for readers of the blog. 

‘Covering Oil, Gold, S&P500 Dollar Index and EURUSD, The Market Timing Report does “what it says on the tin” –  gives you key timing points created from our proprietary cycles system. This allows traders and investors to get an edge on when markets are likely to turn. The MTR has been forewarning readers that a large equity pullback was due- the dates were as given on the chart. Were you prepared?’

The Market Timing Report covers a whole host of topics from geopolitical affairs to the technical position of the markets.

Try the report now and you will receive the current February Edition, last months 2018 Special Edition COMPLETE with a 28 day money back guarantee – no questions asked! All for $97!



Here is a message from my lovely wife Netty who is for reasons best known to herself running the London Marathon, again in April. Any donations would be really appreciated and your previous years kindnesses are not taken for granted!

I am running the Virgin London Marathon on 22nd April 2018 in aid of the Lords Taverners, giving disabled and disadvantaged children a sporting chance.

And finally…

The FA Cup provided few surprises at the weekend, Spurs only drew at Rochdale so a replay there and a tie with the Owls or the Swans who drew. Chelski and the Foxes both won on Friday and play each other next, the Red Devils beat the Terriers and now host the Seagulls who beat the Sky Blues. The Noisy Neighbours are at the latics tonight and the winner gets to play the Saints.

]]> Europa Oil & Gas welcomes support for Holmwood from Environment Agency Mon, 19 Feb 2018 15:44:00 +0000 Hugh Mackay, chief executive of Europa Oil & Gas Plc (LON:EOG), tells Proactive the UK Environment Agency has indicated in a draft decision advertisement that it is inclined to award a bespoke environmental permit for drilling and testing for the Holmwood exploration well.

There will now be a four week public consultation process, taking place between February 15 to March 15.

]]> Oil price, Saffron/Coro, Victoria Oil & Gas, Zenith, Link And finally... Fri, 16 Feb 2018 14:36:00 +0000 WTI $61.34 +74c, Brent $64.33 -3c, Diff -$2.99 -77c, NG $2.58 -1c

Oil price

Traders say it was a funny old day in the market yesterday, an early sell off was closed with a weak greenback helping out, but WTI gained most as it finished up on the day. The differential is now below $3 and means that it won’t be long before it has less attractions than say, Brent in the global marketplace.

To add to all the other supportive voices yesterday saw the Saudis, the Nigerians and the UAE all claiming that adherence was high and will remain so for the long term. This was reinforced when the stories of a long term axis between Russia and the KSA were not denied, remember you heard it here first. The bearish talk is all about the USA but as long as Opec and its friends remain tight and control that marginal barrel they will still be getting more revenue than otherwise, despite how galling it is to see the Shermans revelling in moolah…


Saffron is back with a bang as it reopened this morning at a huge premium to the old days after announcement of the Aim admission document publication. Subject to shareholder approval Saffron will become Coro on or around the 9th of April. There is the small matter of an Open Offer to raise £2m but at 4.38p, the same as the recent bigger raise it should prove popular.

Last night saw the formal launch of Coro Energy with all the razzamataz that you would expect from a Parsons project and amidst the fireworks, smoke and mission impossible music could be seen new director Ilham Habibie who had flown over from Indonesia just for the launch. He is a very impressive man and I suspect that he will be key to the startup of the South East Asia part of the new company’s strategy. Yesterday I interviewed Sara Edmonson who is to be CEO of Coro Energy and to watch the chat and hear more detail about plans for Coro’s future see this link.

Core Finance CEO interview: Sara Edmonson of Coro Energy

Victoria Oil & Gas

It is fair to say that the operational update and 2018 guidance announced this morning is a bit of a mixed bag. Operationally last year concluded very well, La 107 and 108 were completed with gas flow rates ahead of expectations with gas sales in the quarter up 18.56% up on the equivalent 2016 number. That made production in the year a highly respectable 10.98 MMscf/d, indeed a record and one that had demand problems not occured would have had the company set very fair indeed. But, and it is a big but, supply projections will be impacted following the news that ENEO does not place its Logbaba and Bassa power stations back on line, the company estimate 13 MMscf/d if online, 9 MMscf/d if not.

So the company has to rethink strategy for 2018 following a macro event with regards to ENEO which was outside of their control. Taking these things one at a time can give us an idea of what scenarios face the company. Firstly there is little doubt that ENEO, the regulator and the Ministry want the gas switched back on, power cuts are becoming more severe with between 10-15 blackouts a day in Douala at the moment so an agreement has to be reached at some stage. ENEO have said that they don’t want GDC to demobilise the kit and cannot afford to lose the 50 MW from the grid out of 1,300 plus another 100MW that is also missing as a result of this action so hope remains.

There are two obvious ways that VOG are planning to counter this loss of such an important customer, firstly by adding more new thermal customers (three were added in the quarter) and secondly by ensuring that existing and new customers can use GDC gas to power their factories and plants. Using bespoke gas to power installations, especially when gas is already on site, can save companies money, often up to 10%, and of course mean that power is not interrupted as it is at the moment. With modest gensets minimal capital is required and local gas can be switched on immediately.

Other ways of minimising the disruption, although in the longer term, is for the company to ramp up its CNG and NGV solutions and develop its markets and to address the possibility of raising prices for its very valuable condensate products.

Losing a 50+% client is not easy but it is possible ENEO will return but in the meantime VOG must assume that it will not and adjust accordingly. Further reductions in costs are under way and capex has been put back but exciting prospects at Matanda and Bomono are still very much in process. Indeed ENEO receivables, announced as being $8.7m in January have already fallen to $5m and are likely to continue to come down. The ENEO saga has been a blow to confidence just when VOG was about to deliver in a big way, whilst there is no sign yet of it blowing over one must remember that there is still a substantial and highly profitable market in Douala which shouldnt be forgotten.

Zenith Energy

3Q results from Zenith today but as usual on results day all the information is already in the market. The company continue to work on a number of wells in Azerbaijan with increasing success, when I visited the sites in the period I was impressed with the technical staff on site. Elsewhere the company has signed a commitment letter for the purchase of an onshore rig which will have an immediate positive effect when it arrives. The company are still committed to discussions with regard to potential acquisitions and have a number of transactions under consideration at present.


Here is a message from my lovely wife Netty who is for reasons best known to herself running the London Marathon, again in April. Any donations would be really appreciated and your previous years kindnesses are not taken for granted!

I am running the Virgin London Marathon on 22nd April 2018 in aid of the Lords Taverners, giving disabled and disadvantaged children a sporting chance.

And finally…

It’s the FA Cup again and tonight there are two ties, the Foxes play the Blades and Chelski host the Tigers from Hull. Tomorrow the Owls play the Swans, the Seagulls take on the Sky Blues, the Baggies host the Saints, Rochdale entertain the Spurs and the Red Devils are at the Terriers.

Some great jumps racing this weekend, tomorrow at Ascot sses the Betfair Chase with a great lineup and at Haydock it is Grand National trials day

]]> Victoria Oil & Gas confident of positive outcome to ENEO issue Fri, 16 Feb 2018 13:32:00 +0000 Ahmet Dik, chief executive of Victoria Oil & Gas plc (LON:VOG), tells Proactive's Andrew Scott fourth quarter gas sales were up just short of 19% from the preceding three months.

Gross sales amounted to 726mln cubic feet in the fourth quarter, which also represents an 11% increase in the year-on-year comparative.

Dik says they're giving top priority to solving the ENEO issue and management are confident of a positive outcome in the shortest possible timeframe.

]]> Union Jack Oil to take a more 'hands on approach' to portfolio this year Thu, 15 Feb 2018 12:43:00 +0000 David Bramhill, executive chairman of Union Jack Oil PLC (LON:UJO), updates Proactive's Andrew Scott on their planned work programmes for 2018.

“High impact” drilling is slated for the Biscathorpe and Holmwood projects and they're also expecting a new planning application to be made for the stalled Wressle oil field development project. The new documents are due to be submitted to the authorities in April.

Elsewhere, results from recently acquired and ‘worked over’ wells at the Fiskerton Airfield are expected to provide further potential value catalysts for the company’s asset portfolio.

]]> Oil price, Coro, RockRose And finally... Thu, 15 Feb 2018 10:16:00 +0000

WTI 60.60 +$1.41, Brent $64.36 +$1.64, Diff -$3.76 +23c, NG $2.59 -1c

Oil price

The traders took advantage of the better than expected EIA inventory stats to buy crude and the futures yesterday in what was described as a ‘thin’ market. It may be a dead cat bounce, only time will tell but maybe $60 for WTI and $63 for Brent are levels we shall see.

The EIA stats showed a build in crude of only 1.84m barrels less that the whisper of +2.7 and the API number of 3.9m so fears of a massive build were allayed. Further comments regarding adhesion to quotas also pacified the market.

Coro Energy

Today is launch day for Coro Energy as a result of the combination of the Italian assets of Sound Energy and Saffron Energy and PO Valley. New CEO is Sara Edmonson who will head up what we have been told is going to be very much a South East Asia gas play which would explain today’s high level board appointment. Mr Ilham Habibie will join the board as soon as practical and adds significant weight to the board as he is the son of the former President of Indonesia who took the country to democracy and he carries outstanding business credentials.

The launch event tonight will I’m sure, have the same chutzpah as usual and shareholders will hear from the board in detail what the plans are for the company. With new cornerstone investor CIP Merchant Capital cornerstoning the company and the Open Offer having provided every opportunity to climb aboard at the start of such a potentially exciting journey, all is set for another James Parsons and crew investment.

RockRose Energy

RockRose announce that the shares will relist today and that the B shares will be redeemed for 150p a share tomorrow, shareholders can expect payment on 23/2. This has been a massively profitable investment for those who believed the story and there is no reason to believe it will not continue.

And finally…

With the HubCap Stealers thrashing Porto, in Porto last night, the chances of an English club making progress in the tournament are significant. Meanwhile the Gooners and Celtic are in the Boropa Cup, for Gooners fans it is looking like last year for the Red Devils as a first four place in the Prem is far from certain and thus winning this cup begins to have real importance.


]]> Mosman Oil & Gas generating cash from Welch project in Texas Wed, 14 Feb 2018 15:57:00 +0000 John W Barr, executive chairman of Mosman Oil And Gas Limited (LON:MSMN), tells Proactive they produced 3,558 barrels of oil in the four months to January from its Welch project in Texas.

Cash flow from the project was also positive over the period.

At the Arkoma project in Oklahoma, initial oil and gas production rates from the Union Valley zone the Arkoma Stacked Pay project (12%), indicate that it alone may be sufficient for economic field development at Arkoma.

The operator though proposes to produce the Wilcox together with the Viola, Woodford and Union Valley oil and gas production zones.

]]> Iofina kicks off production from new IO#7 plant Wed, 14 Feb 2018 15:38:00 +0000 Tom Becker, president and chief executive of Iofina plc (LON:IOF), tells Proactive construction's complete and they've now begun production at their IO#7 IOsorb® plant.

The site in Oklahoma, USA has undergone hydrostatic testing and evaluations of its systems and is currently processing iodine rich brine water.

]]> Exploration the key focus for Altona Energy as it works to de-risk and sell off coal asset Mon, 12 Feb 2018 08:30:00 +0000 Nicholas Lyth, chief executive of Altona Energy (LON:ANR) tells Proactive's Andrew Scott this year is all about exploration for them.

''We've now got  a partner on board who's willing to support and fund us and we're going to use that money to explore the Westfield tenement and hopefully by the end of 2018 we'd have found what we're expecting to find … in 2019 we'll be progressing it on to a bankable feasibility study'', Lyth says.

''We've got a  £6mln market cap … we've got a lot of coal in the ground, the macro-economic conditions are really at the sweet spot for us at the moment and we've got a joint-venture partner with very, very deep pockets''.

''Our plan is to prove up the resource and de-risk the opportunity for a big player to come in and buy the business''.

]]> Sound Energy advancing exploration efforts in eastern Morocco Thu, 08 Feb 2018 13:19:00 +0000 Proactive Investors oil and gas correspondent Jamie Ashcroft reports on Sound Energy PLC's (LON:SOU) plans for a three-well Morocco drill programme.

The programme will address three independent and ‘high potential’ targets.

Drilling of the first well, TE-9, is slated to kick off in July.

]]> Touchstone Exploration gets underway with new 10-well programme in Trinidad Wed, 07 Feb 2018 15:59:00 +0000 Paul Baay, chief executive of Touchstone Exploration Inc (LON:TXP, CVE:TXP), tells Proactive they've kicked off a new ten-well drill programme in Trinidad.

The first well, PS-602, is located in the Grand Ravine WD-4 Block.

A second rig is expected to join the campaign during February.

]]> Oil price, Touchstone, Tullow, Velocys And finally... Wed, 07 Feb 2018 13:12:00 +0000

WTI $63.39 -76c, Brent $66.86 -76c, Diff -$3.47 n/c, NG $2.76 +1c

Oil price

Oil remains nervous in the risk-off market place and with the EIA STEO forecasting increased US production bulls were to a large degree holding off. Selling when the squids shoved up their forecasts would have been wise but that’s like shooting fish in a barrel…

The EIA forecast that US production is now 10.2m b/d and expected to be 10.6m b/d this year and 11.2m b/d  next year which is another increase in expectations but this will only happen if crude oil remains well above $50 which seems pretty likely just now.

Last nights API stats surprisingly showed a draw in crude of 1.1m barrels, better than expected as was the draw in gasoline stocks, distillates grew by more than expected as recent months.

Tullow Oil

Results from Tullow were in line with expectations, production was 89,100 b/d with guidance for this year of 82/- to 90/- showing no growth but an exciting drilling programme starting in Namibia. Gross profits were $815m and after write offs and impairments the company showed a post-tax loss of $189m. Capex is substantially up as one might expect, $460m this year after $225m last year.


Touchstone announce the start of a ten well drilling programme in Trinidad which is fully funded and should be completed by August giving potentially good news quite quickly. A second rig should shortly be operational giving further operational scope and the company seem confident of good news on the drilling front.


I am deeply saddened by the removal from the Velocys board of Julian West, one of the brightest sparks in the industry and who would be a great addition to any board of directors. Velocys’ loss will surely be someone else’s gain…


Herewith my Podcast link for this week covering a number of pertinent stocks…

VOX Markets podcast: Malcy on Rockhopper, Premier Oil, Trinity, Igas Energy and Diversified G&O

And my interview with Andrew Benitz, CEO of Jersey Oil & Gas…

Core Finance CEO interview: Andrew Benitz of Jersey Oil & Gas


My apologies to those who are awaiting replies to emails, I am not able to give individual financial advice and at the moment am very busy so little chance for comments i’m afraid. I am putting together the new bucket list and appreciate all your lobbying!

And finally…

Swansea continue their good run of form by putting 8 goals on Notts County last night, the Terriers beat Birmingham City to secure a home tie against the Red Devils which they will relish after their previous game at home. Tonight Spurs have an unwanted game against Newport who they couldnt see off last time but surely will tonight.

The first T20 against Australia is underway and the Aussies have won game one at a canter.


]]> SDX Energy offers an 'astonishing opportunity' - Malcolm Graham-Wood Wed, 07 Feb 2018 10:15:00 +0000 Oil and Gas commentator Malcolm Graham-Wood discusses SDX Energy's (LON:SDX, CVE:SDX) latest positive result for the recently drilled ONZ-7 well at the Sebou permit, onshore Morocco.

It achieved an average flow rate of 10mln cubic feet of gas per day during the test.

Graham-Wood also touches on Diversified Gas and Oil PLC (LON:DGOC) following their two significant acquisitions last week.

On Eco Atlantic Oil & Gas Ltd (LON:ECO), Graham-Wood says ''this is going to be a very, very interesting stock this year''. Their exploration projects in Guyana and Namibia - which are partnered with major oil firms - are advanced towards drilling.

And he also has a word on Jersey Oil & Gas Plc (LON:JOG) where  a follow on to the Verbier discovery well is planned for this summer.

]]> Morning Market Pulse - The same, but different Wed, 07 Feb 2018 09:30:00 +0000 FTSE 100 Index called to open +60pts at 7200, holding above 7160 since yesterday evening, but well off overnight highs of 7300 after the rebound was checked by falling highs resistance going back to last Thursday. Bulls need a break above 7220 for further upside; Bears need a breach of overnight lows 7155 for more downside. Watch levels: Bullish 7230, Bearish 7160


Calls for a positive start derive from a strong Wall St rebound, bringing the Dow, S&P and Nasdaq back to positive territory for 2018, that was followed by positive sessions in Asia overnight, although the region’s indices are well off their best levels, which is the same for European equity futures as we write.


This suggests lingering indecision about whether what we’ve seen this week is a long overdue technical correction, or the opening sequence for a greater unwind. An unwind from a protracted period of historically low volatility, yields, borrowing costs and investor concern, which contributed to high levels of market valuation, passive investing, financial engineering and complacency. As the last few days have shown us, things are always “different this time”, until of course, they’re not.


Corporate news this morning: Tesco may be facing a £4bn class action lawsuit from 200K mostly female employees regarding equal pay. Rio Tinto underlying profits ahead of consensus, lower debt, declares biggest dividend in its history, $1bn top up to share buyback. Imperial Brands says on track for FY expectations, but note Japan Tobacco shares -3% overnight after a weak outlook.


Smurfit Kappa still experiencing FX volatility, wage inflation and higher energy/input costs, but good demand from Europe, input cost recovery and improvement in Americas. UK Housebuilders will likely welcome another set of record results from Redrow, which enters H2 with a record order book, while DCC announces its first US healthcare acquisition.


US equity markets closed higher yesterday, paring losses late in the session to turn back positive year-to-date having opened sharply lower. With a trading range of over 1150pts, the Dow Jones closed 567pts higher, led by gains for its largest weighted stocks (Boeing, Goldman Sachs, Home Depot), while the S&P 500 and Nasdaq closed 1.7% and 2.1% higher, respectively, as both indices were led by Tech rebounds following Monday’s risk-off move.


Gold is bouncing from the $1320 floor of its falling channel, benefitting from early US dollar weakness to halt yesterday’s sell-off from $1345. The precious metal will continue to be in focus as a safe-haven amid equity and bond volatility, while the performance of the global reserve currency will also be closely watched.


Crude Oil benchmarks have moved higher from overnight lows as the API reports a surprise drawdown in US inventories, further helped by early US dollar weakness but capped by a continued cautiousness in risk assets. Brent Crude is testing falling highs resistance from yesterday’s $68 highs, while US Crude trades within a $63.8-$64 range having retreated from $64.2 overnight highs.


In focus today will be further digestion of the past three rather lively trading sessions, and analysis as to whether this is a mere technical correction or the start of a greater unwind.


Only two pieces of macro data to note today, with UK Halifax House Prices (8am) seen returning to growth in January from December’s 4-month low, although retreating on a yearly basis, while US EIA Crude Oil Inventories (3:30pm) will look to repeat last night’s surprise API inventory drawdown with consensus for a build.



Speakers today include the ECB’s Lautenschlager and Nouy (10am) both appearing at the Annual Press Conference of ECB Banking Supervision this morning, while the NY Fed’s Dudley (1:30pm) is a panellist on a debate entitled ‘Banking Culture: Still Room for Improvement?’, Chicago’s Evans (non-voter; 4:15pm) discusses current economic conditions and monetary policy with a Q&A session, and San Francisco’s Williams (voter; 10:20pm) takes part in a Q&A session after the US close. 

]]> Oil price, Rockhopper/Premier, Trinity E&P, Amerisur, Aminex, Faroe And finally... Mon, 05 Feb 2018 14:35:00 +0000

WTI $65.45 -35c, Brent $68.58 -$1.07, Diff -$3.13 -72c, NG $2.85 -1c

Oil price

After the latest bullish forecast from the Vampire Squids last week traders should have taken the other side of the trade and taken a walk, innate forecasting inability like theirs is a gift for others. Less tongue in cheek was the market fall, brought on as it was by the economic data on jobs and wages which rallied bonds and with them the greenback as expectations of rate rises firmed. WTI ended the week down 69c and Brent was worse at -$1.07 with the differential down at $3.13 as low as it’s been for a while.

The rig count was a marginal minus as well, overall the count was down 1 to 946 but in oil it was up 6 at 765 units.


RKH has announced this morning an LOI with Diamond Offshore Drilling for a ‘suitable drilling unit’ for the Sea Lion Phase 1 development. For those with short memories it was DOD with whom RKH worked with in the highly successful exploration phase of the campaign in the Falklands and that ‘teaming up with Diamond is a significant step in our continued progress towards sanction with our partner Premier Oil’.

Having already signed LOI’s with well services and logistical support the focus moves onto the subsea equipment suppliers where the JV are hoping to make progress during the 1st quarter. These important pieces of the jigsaw are highly encouraging as the partners continue the crucial discussions with regard to the senior debt element of the financing plan.

There must be little doubt that as they move closer to sanctioning the project,  such ‘material progress’ has been made on so many fronts, to be coming to this decision with three years of intensive industry cost cutting behind it and an oil price as it is now is surely the stuff Dreams are made of.

Trinity Exploration & Production

A Q4 operational update from TRIN this morning where things seem to go from strength to strength or as the management state, ‘a clear upward trajectory’. The update shows profitable production and a strengthening balance sheet as the strategy of a low cost, high return  programme of recompletions, workovers, reactivations and swabbing comes into its own. An 11% increase in production to 2,777 b/d is doing pretty well in any language but to do this from inventory and with existing cash flow is even more encouraging.

Operationally TRIN is amongst the best in the business, a third workover rig has been subcontracted and there was a 19% increase in man hours from 1,741 to 2,067 in the period. During December the company report production of over 3,000 b/d on at least 14 occasions as recompleted wells flowed naturally before returning to more sustainable production rates. Whilst this was a temporary state of affairs it shows that TRIN does have critical mass and ‘evidences a clear upward trajectory being delivered’ towards its near term production targets and all this before the drilling of any more wells which can be expected this quarter. For the time being it is aiming for 3,000 b/d by ‘later in 2018’ before achieving a more material step change in production in the medium term. This is a genuinely significant move for the company and its shareholders as TRIN has worked the model so tight that it has an EBITDA margin the envy of any company in or out of the oil sector.

The sale of the West Coast assets is still ongoing with interested parties making representations all the time, such moves are not distracting to the management as these assets are continuing to produce free cash flow. With all this good news on so many fronts Trinity is clearly amongst the most profitable companies in the E&P sector, yet maybe due to the events of the past it is yet to be appreciated by the market. Accordingly the move into the imminent bucket list update is a formality.

Amerisur Resources

Monthly production, OBA throughput data and an operational update from AMER all pretty much in line with expectations. Average daily production was 6,837 b/d with a peak of 7,142 b/d subject to works being incurred at Platanillo. The OBA throughput averaged 5,622 b/d with a peak of 6,541 b/d, this was affected by planned maintenance and enhancement work at the Cuyabeno station which is now completed. At CPO-5, Mariposa-1 continues to produce at 3,250 b/d on long term test as analysed by AMER and ONGC Videsh.


A significant resource upgrade today from RPS which is way better than had been expected. This and other data from io, confirms the feasibility of developing the Ntorya  gas field for commercial production. The Ntorya Pmean GIIP is increased to 1.87 TCF, an increase of 44% on managements latest estimates (1.3 TCF) and 12x the previous CPR. The 2C gross contingent resources number is up 11x from previous CPR at 762.8 BCF.

These numbers significantly exceed management’s expectations and without doubt put its acreage in Tanzania on the highest quality footing for the future. As a substantial player in country Aminex can expect to be able to proceed with limited upfront expenditure and use revenues ‘to enable cash-flow funded further development’, in what is a now realistic and achievable proposition. Aminex has now for once and for all become of significant strategic importance to the Tanzanian economy even if that means getting infrastructure funding for the pipeline.

With a highly supportive cornerstone shareholder encouraging the highly qualified and entrepreneurial management, shareholders can look forward to  an exciting run in Tanzania and now that executive time can be spared it would come as no surprise to see some geographical expansion for Aminex. Even after the 18% rise at time of writing I consider that the shares should at least head back to highs achieved only a year ago.

Faroe Petroleum

Faroe has announced that the Fogelberg appraisal well (and contingent sidetrack) has been spudded with the intention of narrowing the range which is at present 105-160 BCF. The range is so high as the initial discovery well was situated high on the structure and this well should provide additional information for development planning. Faroe remains in a strong position with a number of interesting wells either under way or scheduled for this year intended to add to the exciting number of projects in development.

And finally…

The 6 Nations rugby Championship started at the weekend with Wales beating Scotland 34-7 which at least surprised the Scots, Ireland left it to the last minute to beat France with an inspired drop goal and England won 15-46 in Rome.

In the Prem the Noisy Neighbours were held 1-1 at Burnley after the miss of the season might have won it… The Terriers visited the Theatre of Dreams and lost 2-0 and the game of the weekend was at Anfield where the HubCap Stealers drew 2-2 with the Spurs. Mr Klopp didnt like the penalty count but it was a mad last ten minutes.

And in the Superbowl the Philadelphia Eagles beat the New England Patriots 41-33 which was the highest number of points conceded by a winner and the first time that a player had both thrown and caught a touchdown pass in history. (US sport contributor still asleep)


]]> Solo Oil welcomes major upgrade to Ntorya gas resources Mon, 05 Feb 2018 12:10:00 +0000 Neil Ritson, chief executive of Solo Oil PLC (LON:SOLO), discusses with Proactive the findings from the recently completed CPR which reveals a major upgrade to the gas resources at the Ntorya project in Tanzania.

It follows the Ntorya-2 appraisal well success and an assessment of well testing.

Ntorya’s contingent gas resource has now risen to 762.8bn cubic feet of gas, comprising 80.6bn cubic feet of gas that’s described as pending development – to be addressed by the planned initial three well operation.

Two of the three wells have so far been drilled, and the third is due later this year. The gas would be connected to a gas plant located some 33 kilometres away.

Solo Oil holds a 25% interest in the project.

]]> Aminex delighted with significant resource upgrade across Tanzania assets Mon, 05 Feb 2018 10:39:00 +0000 Jay Bhattacherjee, chief executive at Aminex plc (LON:AEX), discusses with Proactive the findings from the latest CPR on their asset base in Tanzania.

Among the highlights is a 44% increase in management estimates for gas initially in place across Ntorya from 1.3 TCF to 1.87 TCF.

The new figure also represents a 12-fold increase over the 2015 CPR.

''It's obviously a big piece of news for us ... we're pretty delighted about the results but more so the work we've put into getting the results''.

''We've been working quite hard at the basin model and based on the drilling of Ntorya-2 and some of the interpretation of the data we've re-created the basin model and it's always nice to have your work verified ... and reinforces that this asset is of national importance''

]]> Oil price, SDX Energy, IGas, Ophir, DGO, And finally... Fri, 02 Feb 2018 14:27:00 +0000

WTI $65.80 +$1.07, Brent $69.65 +76c, Diff -$3.85 -31c, NG $2.86

Oil price

The monthly numbers for crude oil were good, WTI rose 7.1% and Brent was up by 4.35%, a decent performance under the circumstances. If there had been a blog yesterday it would have noted that poor API inventory stats were not continued in the EIA numbers which showed a draw of just over a million barrels in line with estimates.

Today almost all the news remains positive, the Reuters survey says that looking at Opec production data for January adhesion remains high at 138% and of course the Fed upped their growth targets at this weeks meeting. Brent has expired remaining in positive territory but notice the differential back down at $3.85.

I said almost because it seems like the Vampire Squids are doing their best to ruin the party for everybody. Having only just raised their oil price targets (Jan 17th) then Mr Currie suggesting prices were a bit ‘too high’ (Jan 18th) I notice that they have upped their targets again to $75 (3m) and $80 (year end) in an attempt to catch up with the market. We are all doomed.

SDX Energy

An update from SDX this morning in which they announce that the KSS-2 development well has spudded in the Sebou Permit onshore Morocco. The duration of the well should be 10-15 days and if successful will be connected to local infrastructure. The ONZ-7 well is scheduled to complete today and commence test production early next week. On Tuesday I did a CEO interview with Paul Welch and the link is below.

Core Finance interview: Paul Welch, CEO of SDX Energy

IGas Energy

An operational and trading update from IGas this morning and two things are different from recent announcements. Firstly, with production of 2,335 /d and guidance of 2,300-2,400 b/d IGas’s conventional production is now generating free cash flow and therefore all the shale is effectively upside. Secondly there are actual signs of activity with the drill bit in North Nottinghamshire as they are planning to go ahead and drill Springs Road mid year and then Tucker Lane.

The company, as with other onshore players, have had trouble with local council planning committees, in their case at Ellesmere Port which I thought was nailed on but I am sure that another winter of electricity supply uncertainty might prod the most Luddite of councils. Despite these upsets I’m still confident that IGas which still has a huge carried work programme and highly competitive costs is in a strong position in the industry.

Ophir Energy

When I last wrote about Ophir on 17th January after their trading update I was, for the first time in a long time starting to become more positive about the company and its short term prospects, it appears that the market did not share my optimism. With no recent announcement about funding for Fortuna I can only imagine that it is this what is spooking the market and that all the good things that I mentioned at that time are peripheral at the moment.

Anyway, todays announcement that the company has been awarded a 20% stake in blocks 10 and 12 in the Mexico offshore bid round 2.4 is good news and adds to their existing block 5 in the area.

Diversified Gas & Oil

DGO announced yesterday that they had made two acquisitions totalling $180m and done an oversubscribed placing  raising the same amount, and the same as the market cap, no mean feat in any market. This increases production by 173% and PDP MMboe by 217%.

I have met DGO when they first came to the market but have failed on recent visit to catch up, by the looks of it the acquisition of US onshore acreage and paying dividends has attracted to UK market and the 28/- b/d puts them right up there at least in size terms, more when I can meet them.


In case you didnt catch my Podcast this week the link is below.

VOX Markets podcast: Malcy on Jersey Oil & Gas, Serica Energy, SDX Energy and Rockrose Energy

And finally…

And what a weekend of sport it is looking like….

The start of the 6 Nations Rugby is always a magnificent time and this one should go down to the wire. Tournament favourites appear to be Ireland but I suspect England will be hard to beat and dark horses must be Scotland after the autumn internationals… Tomorrow its Wales v Scotland and France v Ireland and on Sunday England travel to Rome to play Italy.

Football almost becomes irrelevant but the big game at the weekend is the HubCap Stealers v Spurs while Burnley host the Noisy Neighbours and the Terriers visit the Theatre of Dreams. The Gooners are all over the shop and host the Toffees which could be interesting and Chelski dont play until Monday.

If you want some racing at the weekend you have to go to Leopardstown where there is amazing racing and can see Faugheen and Footpad amongst others to give invaluable Cheltenham pointers…

The New England Patriots face the Philadelphia Eagles on Sunday night at Super Bowl LII in Minneapolis. These teams have met in a Super Bowl before and the Eagles will be hoping to avenge the loss they suffered in 2005 when Tom Brady led the Patriots to a 24-21 victory.



]]> Diversified Gas & Oil sees significant increase in production through latest acquisitions Thu, 01 Feb 2018 08:09:00 +0000 Rusty Hutson, chief executive of Diversified Gas & Oil plc (LON:DGOC), tells Proactive they'll triple their gas production through the acquisition of two producing assets in the Appalachian Basin, US, at a cost of US$180mln.

Alliance Petroleum Corporation will be bought outright for US$95mln while DGO is also buying the Appalachian assets of a NYSE-listed, but unnamed, company for US$85mln.

Both are cash deals and will be funded fully by a share issue at 80p per share.

]]> Oil price, Echo Energy, Range Resources, i3 Energy And finally... Wed, 31 Jan 2018 09:59:00 +0000

WTI $64.50 -$1.06, Brent $69.02 -44c, Diff -$4.52 +62c, NG $3.19 +3c

Oil price

The general drift continues and yesterday indices fell in advance of the State of the Union address, this morning oil is also down by around 40 cents.

Echo Energy

An update from Echo this morning in which the company announces that it has completed the acquisition in Argentina and is now ready to initiate the 2018 work programme. Tenders for the planned seismic programme have been issued and also a slot has been reserved for the four exploration well programme scheduled to start in Q2 2018. With $32m in the bank Echo is fully funded for this years exciting programme which one might expect to hear about in a few months time.

Range Resources

Quarterly update time for Range where production is up 9% on the previous period at 651 b/d. The two acquisitions in Indonesia and Trinidad were completed so investors can look forward to these providing significant interest this year. After the quarter end the GY 684 development well at Beach Marcelle was brought onstream at 120 b/d.

i3 Energy

i3 has raised £2.57m at 30p and has other ‘multiple funding options at an advanced stage’. Farming out of Liberator appears to be close to completion and also some of its applications in the 30th round. One to watch although plenty to do.

And finally…

Briefly, last night Prem programme saw the Swans continue their winning ways by seeing off the Gooners 3-1, the HubCap Stealers won any way you like at Huddersfield and the Hammers and the Eagles drew 1-1. The rest of the programme tonight sees the Red Devils at Wembley against Spurs, Chelski play the Cherries and the Noisy Neighbours host the Baggies amongst other fixtures.


]]> Tlou Energy anticipating government power proposal outcome 'in coming weeks' Tue, 30 Jan 2018 10:03:00 +0000 Tony Gilby, managing director of Tlou Energy Ltd (LON:TLOU, ASX:TOU), updates Proactive on operations in Botswana, highlighting a number of project milestones.

Tlou's completed a seismic survey across the Lesedi and Mamba project areas, obtaining ‘excellent data’ in the process, and has drilled two new core-holes at Lesedi.

Gilby says drilling intersected “gassy coals” and core samples are currently being analysed.

]]> Oil price, Jersey Oil & Gas, President Energy, Serica Energy And finally... Mon, 29 Jan 2018 13:15:00 +0000

WTI $66.14 +63c, Brent $70.52 +10c, Diff -$4.38 -53c, NG $3.51 +6c

Oil price

That was the good week that was, WTI continued to outperform Brent and was up $2.83 on the week vs +$1.91 bringing today’s differential closer to $4 than $5. The rig count rose sharply, by 12 in oil to 759 which will worry the bulls as the US production numbers rise again, that and a modest rally in the greenback has pushed oil back down, Brent is back below $70 this morning. And no reason why not really, there are fewer reasons to go up than down right now although bulls are still running the show.

Jersey Oil & Gas

An operational update from JOG this morning which is very much what shareholders are looking for. The work programme and budget for 2018 has been agreed by the ‘co-venturers’. This will include an appraisal of the Verbier discovery and ‘contingent well planning including acquisition of a site survey to progress exploration activity on the licence area’.

Negotiations for a rig are ‘advanced’ to drill one well and with the option for a side-track to be drilled in the summer of 2018. All this can be funded from the company’s cash reserves which after the autumn raise leaves December 31 2017 cash of £25m, capex for this year is an estimated £9-11m so plenty of headroom and I hope that a modest production acquisition maybe on the cards.

With an exciting programme of events for this summer and a gross recoverable resources range of 25-130 mmboe as estimated by none other than Statoil, things are looking up for JOG in no uncertain way. Taking the estimated mean Statoil number of 69 mmboe and the oil price of $70 I still think that JOG has massive potential upside with a market cap of only £47m. The shares are surprisingly off 4% this morning but this may be a bit of profit taking after a 23% rise so far this month, stick with the shares, they won’t be coming out of the bucket list…

President Energy

A swift mention of President and the recent tax reforms that have come into place in Argentina. The corporate income tax rate has fallen for 2018 and 2019 from 35% to 30% and from 2020 to 25%. PPC is very well placed to take advantage of these as it has tax losses to offset against profits which will continue until 2019 and will fall straight through to the bottom line adding value to the company. Post 2020 the lower rate will increase cash flow and boost profitability.

Serica Energy

A positive update from Serica this morning as is goes about closing the BP deal in which it acquired stakes in Bruce, Keith and Rhum assets, these had been hit by the Forties pipeline closure but are back up now. At Erskine there has been serious missing of guidance, production is 1,975 b/d against expected 2,200 b/d down to waxing problems which are expected to be cleared and production can increase.

The company has two wells to drill this year, the Rowallan exploration well in the second half and Rhum#3 recompletion/re-entry well in Q2/3 and if all goes well will tie in before the end of the year. Cash is $34m and debt is $3.9m, so assuming all the technical problems can be sorted, SQZ is looking reasonably well funded. I havent had an opportunity to meet with Mitch Flegg since he joined and have today put in another request, let’s hope it can be fixed up before long.

And finally…

The FA Cup weekend saw wins for the Noisy Neighbours, the Red Devils, Chelski and the Foxes, Spurs could only draw at Newport and the HubCap Stealers went out at home to the Baggies. Notable wins for the Sky Blues, the Latics, the Dons and the Owls.

England completed the one dayers down under, winning the last game and the series 4-1, just the T20’s now….

And it was sad to see the founder of IKEA passing away at the weekend, his funeral is expected to be later this week or however long it takes to put his coffin together….


]]> 'Watershed moment' for Rose Petroleum with new Paradox Basin data Mon, 29 Jan 2018 12:46:00 +0000 Chris Eadie, CFO at Rose Petroleum PLC (LON:ROSE), discusses with Proactive's Andrew Scott new analysis of its Paradox basin acreage, in Utah, which sees the potential for some 450mln barrels to be present.

Specifically, they've received the initial interpretation of new 3D seismic data for a 20 square mile area known as the Gunnison Valley Unit or GSU.

The process, which is ongoing, has identified some 53 potential well locations in the Cane Creek reservoir zone.

]]> The Pay Zone - Oil price, SDX Energy, RockRose Energy And finally... Fri, 26 Jan 2018 14:21:00 +0000 Oil price

It has not been a bad week for the oil price, news has mainly been positive and the dollar remained weak until the Donald gave it a leg up yesterday (before which Brent had traded over $71) although the greenback is back down today. Wednesday started with the API figures from after the close on Tuesday exerting downward pressure but the EIA numbers were much better showing as they did another 1.1m barrel draw, the tenth successive down week.

This brought stocks close to the magic five year average, one of the key points of reference for Opec and Russia and with Cushing seeing another 3.15m draw WTI started to catch up with Brent. This was also seen in the NSL numbers where money managers increased their positions by 37.5m bbls which was split WTI up 41 and Brent down 3.4.

SDX Energy- Visit, preliminary thoughts

I spent a few days with SDX Energy in Morocco this week along with a decent crowd of investment analysts which shows that the SDX story is rapidly gaining credence and depth. The story of SDX in Morocco is one of ‘simplicity made profitable’ as they describe it and from what we saw that is most definitely the case. The idea is to explore in shallow prospects, find gas, where at present they have an 80% success rate, transport it directly and sell the gas to the client on site. The gas needs little or no treatment being 99.6% methane and the potential client base is substantial. As a result margins are high, drilling costs are low and reducing all the time with rig procedure influenced by US onshore practices such as smaller, non concrete pads and biodegradable waste treatment. This has kept operating costs down, currently 30c per MCF there and thereabouts. The fiscal regime is also helpful with a ten year tax holiday and no royalties and contracts tend to be on a  5 year fixed price basis.

Gas prices are relatively high at $10/MCF with the Government pushing for this to be upped to $12, so at present each BCF is worth $10m probably escalating whenever contracts are renegotiated. So how does the potential market look like? Existing customers take 6 MMscfd and the pipeline capacity is 24 MMscfd so the scope is huge and with estimates of demand identified as 52 MMscfd one can see significant upside. There is significant cooperation with ONHYM who have the local knowledge, staff and experience and really appear to be extremely supportive, this can be seen in ‘Project Vingt Quatre’ which is the joint plan to fill up the pipeline which would quadruple cash flows. ONHYM also have the exploration background and relationships with the client base that also helps SDX considerably, their help towards SDX was obvious by the big turnout at very senior level at Wednesday’s dinner which was really good to see.

All this is possible as there is significant potential to grow reserves, needed for new customers or when wells start to see production declines. The company has identified 50+BCF of potential reserves which will be needed when one bears in mind a full pipeline and five year contracts. I would expect apart from the current 9 well programme, more 3D seismic and another drilling campaign to get underway later in the year.

Whilst in Morocco we saw a number of clients including the largest, Super Cerame where we visited a highly efficient factory producing a wide range of ceramics and also had a speech from the Director of CMCP ( Subsidiary of International Paper) who produce both paper and cardboard and use significant quantities of gas with their drying techniques. We visited the Atlantic Free Zone (AFZ) which is attracting major clients such as Peugeot which is already a new customer connection, here SDX is considering installing a 7 way gas distribution hub in order to easily connect new customers attracted by the AFZ.  Later we were given a presentation by the MEDZ Free Zone at Kenitra who have a very credible existing footprint with a lot of signed up companies but there is room for many more.

We were able to visit a number of well sites, a couple that were in production and the recent discovery at ONZ-7 which is finishing off wireline and cement logging before going onto production shortly. There are four wells still to be drilled in this campaign, two development wells and two exploration wells further north at Lalla Mimouna. As mentioned there is an aggressive seismic plan in the Rharb Centre concession where potential leads can be established.

All in all the visit was undoubtedly a success,  there is much going on and with a high degree of operational conversion  there is little doubt that the market for this high margin gas is substantial. The company are targeting the upper end of 8-10 MMscfd by the end of the year and this  should be easily attained. Nearly a year on from the Circle acquisition costs are down substantially (headcount down from 150+ to 35) in all areas, margins are up and growth looks increasingly likely. More later.

RockRose Energy 

An update from RockRose Energy this morning which primarily includes the return of capital to shareholders amounting to £1.50 per share. The directors have also announced that they will consider an annual dividend and also possible hedging as a response to the recent rise in oil prices. I understand that the shares will return from suspension cum dividend the week of the 5th February and will go XD after the EGM on 14th February so not long to wait for the payout.

With production guidance of 5,250boed RRE have been highly successful in their initial strategy even if the Maersk deal has fallen over and Chairman Andrew Austin remains confident about doing more deals. Opex pb is below $30 and G&A is $3pb so the company is cash generative. Returning cash to shareholders in this manner seems entirely sensible, it is efficient for the company and its investors and shows that RRE will not sit on a pile of cash for longer than necessary. As and when the company need to raise money it is likely that those investors will remember this event.

And finally…

Hard luck to Bristol City who put up quite a fight against the Noisy Neighbours whilst I was away!

This weekend its the FA Cup with its usual mix of fixtures quite a lot of which are on TV. Tonight sees Yeovil host the Red Devils which is always a favourite for the neutrals, they always love to see the big club go down and Yeovil did well against them when they last met in the Cup. The Noisy Neighbours go to Cardiff, Spurs are at Newport, Chelksi host the Magpies and the HubCap Stealers entertain the Baggies. The Hammers have a tricky tie at the Latics and the Foxes go to the Posh whilst there is another all Prem ties between the Saints and the Hornets.

England started the latest one dayer as if they were already on the plane home, 8-5 after not very long and they did indeed lose.


Some great NH racing at the weekend, mainly a great card at Cheltenham but also Doncaster.

]]> Cabot Energy makes strong start to the year and on track to hit 2018 targets Thu, 25 Jan 2018 14:38:00 +0000 Cabot Energy Plc (LON:CAB) chief executive Keith Bush tells Proactive Investors their evolution into a significant producer has begun.

Bush says production averaged 827 barrels of oil per day through the first half of January, and output for 2017 averaged 400 bopd.

Cabot's now targeting between 1,600 bopd and 2,000 bopd by the end of 2018 - with guidance set at 1,000 bopd to 1,200 bopd on average for the year.

]]> Haydale Graphene 'moving up the value chain' and seeing strong growth Thu, 25 Jan 2018 13:02:00 +0000 Ray Gibbs, chief executive of Haydale Graphene Industries PLC  (LON:HAYD), caught up with Proactive following their half-year trading update for the six months to the end of December 2017.

Haydale reported a sharp pick-up in sales helped by the separation of its business into two units.

Revenues rose by 67% to £2.49mln (£1.49mln).

]]> Europa Oil & Gas hires industry heavyweights as new chairman and non-exec director Thu, 25 Jan 2018 08:26:00 +0000 Hugh Mackay, chief executive of Europa Oil & Gas Holdings Plc (LON:EOG), discusses with Proactive's Andrew Scott the appointment of Simon Oddie as the company's new chairman - replacing -Colin Bousfield.

Europa's also hired former Petroceltic boss Brian O’Cathain as a non-executive director.

]]> EQTEC Plc in advanced discussions with major European EPC contractor Wed, 24 Jan 2018 12:38:00 +0000 Ian Pearson, chairman of EQTEC Plc (LON:EQT) caught up with Proactive's Andrew Scott to update on their pipeline of projects in the UK and Croatia following the deal last year between EQTEC and EQTEC Iberia.

''We've got a proven model which works, we've got patented technology and some world-class engineering skills ... and partnerships with contractors that can deliver the projects that I think the market wants'', Pearson says.

''Waste-to-energy has gone through a difficult time as a sector but it's very clear to me that its time has come''.

]]> Oil price, SDX, Sound, Saffron, Cairn, Angus, Link And finally... Tue, 23 Jan 2018 14:18:00 +0000

Oil price

Whilst all those clowns play in the snow at Dav-Oh the rest of the world is getting on with business, the real world you might say.

In the real world, oil is going up and for a very old fashioned reason, as the best ever oil analyst David Gray would say, control of the marginal barrel is being exercised. From the Muscat conference came a renewed agreement between Russia and Saudi Arabia in which they pledged to continue their commitment to cutting oil supplies not just through 2018 but possibly next year as well and with ‘unwavering resolve’. For those with long memories it is almost like the Russia/KSA axis is acting in the swing producer role, aware that as long as they are together then a base camp of say, $60-70 can be established bringing some sort of stability to economics. Now clearly this doesnt last forever, nothing does, but it is more than a possibility that for the time being at least plans can be made.

Adding to the fun was the IMF who added to oil demand by upgrading world growth numbers to 3.9% for this year and next, what’s not to like about that?

SDX Energy

Another day, another good well result from SDX who have announced that the ONZ-7 development well at the Sebou Permit in Morocco is a gas discovery. With 5m of net conventional natural gas pay in the Hoof formation the well was on prognosis but the reservoir quality exceeded expectations with encountered porosity in the pay sections of 35.3%. With an analysts’ visit to Morocco starting this afternoon I expect us band of SDX brothers to be increased substantially before long, this is not a secret that one can keep for long…

Sound Energy

The final resources certification for the TE-5 horst core volumes at Tendrara onshore Morocco have been announced by Sound. The numbers are entirely consistent with and confirm the preliminary results announced last December.

The company has announced that Stephen Whyte is leaving the position of Chairman of the Board in order to concentrate on other directorships that he holds, this includes Echo Energy where he has superb Latin American experience to share. Richard Liddell takes over and will add to the Non-Executive board in due course.

Saffron Energy/Coro Energy

Yesterday afternoon Saffron, soon to be Coro, announced that the book building in its raise announced yesterday had concluded and was oversubscribed. The company raised £14m with applicant getting 2 warrants for each share subscribed at a price of 6.57p being 150% of the 4.38p raise price. CIP Merchant Capital subscribed £6m to become their cornerstone investor, Marco Fumagalli will join the board and is a familiar face in the Holy Trinity…

Cairn Energy

No surprises in the trading update from Cairn today, first oil from Kraken and Catcher and the near conclusion of the first phase of the Senegal development in the period. In Senegal Cairn expect Government approval this year and first oil between 2021-2023 which is a wide window, as is expected production at 75-125/- b/d. This year will see drilling in the UK and Norway and next year in industry hotspot, Mexico.

Angus Energy

I was firmly put in my place yesterday as I said that Angus would be drilling the  horizontal 2Z well, actually it has all been done, all they need to do is switch it on in order to test it which is the main advantage in the short term, my apologies…


Yesterday was VoxMarkets Podcast day in which I discussed a number of stocks, bear in mind my faux pas on the Angus well is here also, its a test….

Vox Markets podcast: Malcy on Angus Energy, Saffron Energy, Coro Energy, Sound Energy, Echo Energy, Amerisur Resources and SDX Energy

And finally…

With only a bit of catch up to play the HubCap Stealers went to bottom of the table Swansea brimming with confidence but came away pointless after losing 1-0.

The Bristol City army is gathering already I suspect as the mighty Robins prepare to welcome the Noisy Neighbours to fortress Ashton Gate in the 2nd leg of the Haribo Cup semi-final. Good luck to Andy Bone and of course Giles Clarke, famous City and blog reading fans who are only 1-2 down from leg 1.

And huge congratulations to Kyle Edmund who has reached the semi final of the Australian tennis Open, he will meet either Rafa or the palindromic Cilic who are battling it out as I write.



]]> Solo Oil welcomes Helium One's intention to float on ASX Mon, 22 Jan 2018 10:38:00 +0000 Neil Ritson, executive chairman of Solo Oil PLC (LON:SOLO), updates Proactive's Andrew Scott on the progress of its 15% owned associate Helium One which is considering options for new funding to support exploration plans in Tanzania.

Ritson says an IPO, onto the Australian Securities Exchange, is one option being considered by Helium One and it has now appointed Aussie stockbroker PAC Pty to help it review this potential outcome.

]]> Oil price, Genel, Prospex Oil & Gas/Po Valley And finally... Fri, 19 Jan 2018 11:51:00 +0000

WTI $63.95 -2c, Brent $69.31 -7c, Diff -$5.36 -5c, NG $3.19 -4c

Oil price

Conflicting news yesterday which has knocked oil prices a modest amount today. The Opec report was mainly positive and although they said that higher oil prices are bringing supplies onto the market, that is countered by global demand rising faster than non-Opec supply. The EIA monthly report is not so bullish, saying as it does the US supply is going to rise faster than demand, such is a market made. Their inventory report was positive though as crude drew 6.7m barrels against a forecast 2.1m including a most pleasing draw in Cushing at 4.6m. Unsurprisingly gasoline added 3.6m, its hardly driving weather, but it is heating weather and distillates drew 3.9m against a forecast build, what analysts made that call?

On a technical basis it is now clear that the resistance encountered should serve as a ceiling for the time being but there are enough geopolitical banana skins to make going short this market quite some risk. Such a problem is indicated by the statement from the Niger Delta Avengers yesterday who warned that forthcoming attacks ‘would be most deadly’, upcoming elections are unlikely to be peaceful.

Genel Energy

Genel has announced a Bina Bawi and Miran West gas resource resource update by RPS. The company suggest that this is a ‘significant’ update to 2C gross raw gas resource estimates. At 14,792 Bscf ex condensate the number is up 40% which is clearly good news. In an obfuscating statement I think Genel are trying to say that the gas is a genuine mid to long term significant positive for the company which it certainly is.

Prospex Oil & Gas/Po Valley

PXOG, via operator PVE has announced a ‘significant’ and commercial gas discovery onshore Italy with their Podere Maiar-1d well in the Selva gas field. C2 (net pay 25.5m) 148,136 scm/d and C1 (15.5m) 129,658bscm/d.

As it happens I visited with Prospex yesterday and met with CEO Edward Dawson, I had been looking forward to meeting up as his story is one of interest and of course so is the Po Valley play given current corporate events occuring. The Prospex portfolio is not your standard one, covering as it does Italy, Spain and Romania concentrating on the Foredeep play and having had good results in both Romania and now Italy.

The jury is out on the size of this discovery, PVE don’t appear besotted by it but they have plenty of fish to fry at the moment. On the contrary, PXOG is looking forward to the short term as Chairman Bill Smith says “The year ahead will not be short of high impact newsflow, as we focus on exposing our shareholders to near term value trigger events, such as drilling and first production.”


And finally…

It is wrong and discourteous to say that there isn’t a stand out fixture in the Prem this weekend but put it this way the most difficult forecast is probably the Red Devils at Burnley. The Noisy Neighbours host the Magpies, the HubCap Stealers are at the Swans on Monday, Chelski are at the Seagulls, the Gooners entertain the Eagles and Spurs go to the Saints, get my drift?

Good jumps racing from Ascot at Haydock which hosts the legendary Peter Marsh chase.

And in the cricket this morning England went 2 up in the 5 match series with a comfortable win against the Aussies, the white ball doesn’t give England the heebies as the red one does…


]]> Europa Oil & Gas welcomes new planning application for Wressle Thu, 18 Jan 2018 10:44:00 +0000 Europa Oil & Gas Plc (LON:EOG) alongside Union Jack Oil PLC (LON:UJO) and project operator Egdon Resources Plc (LON:EDR) have told investors they'll now be making a new planning application to the North Lincolnshire council seeking consent for the Wressle field development.

It comes after the planning inspectorate earlier this month rejected appeals made by Egdon and its partners following prior planning refusals by the council.

Europa chief Hugh Mackay tells Proactive's Andrew Scott he reckons they've got a strong case.

''We believe we can address all issues relevant to the development of Wressle to the satisfaction of the planners and that's what we'll be doing''.

]]> Oil price, Wentworth Resources, Egdon/Union Jack/EOG And finally... Thu, 18 Jan 2018 10:21:00 +0000 Oil price

Oil rallied a touch yesterday after the previous day’s technical drop ahead of the weekend meeting of Opec and Russia in Muscat. After the close the API stats were very positive with crude stocks drawing by 5.12m barrels against a whisper of 3.15 although the real star was the fall in stocks at Cushing of 3.94m barrels.

When you are in a hole, stop digging is the usual mantra but after yesterday’s unsurprisingly poor figures from the commodity desk at the Vampire Squids, last night the head of the department warned about prices running too high, a far cry from the reverse forecast last year…

Wentworth Resources

WRL has announced its annual evaluation by RPS of gas resources at its Mnazi Bay, Tanzania flagship asset this morning. The numbers are very respectable given increasing levels of production last year and carrying on into 2018. 2P reserves on an NPV 10 basis are $159.6m with 1P reserves of 97.3 Bscf gross and net of 72.7Bscf. 2P numbers are 176.4 Bscf gross, 115.1 net and 3P are 265.0 and 155.8 Bscf.

As reported recently current production is consistently increasing with visibility very good and guidance has been increased for the project. WRL is looking in a strong position, is well managed (I am looking forward to meeting highly thought of new CEO) and the outlook is good.

Egdon/Union Jack/EOG

Egdon and its partners have announced that following the recent planning refusals by the North Lincolnshire Planning Committee they have submitted a new planning application for the Wressle development. They have also requested an extension of the current planning consent, which expires in April, to ensure that the Luddites on the committee have time to read it, assuming that is……..

And finally…

It is always good to have a guest comment in the and finally, during the summer usually MotoGP, sometimes on US sport and today I can’t resist quoting an email just in from a Canaries fan.

‘What a fabulous, incident packed game – no matter that we lost on penalties as all the Canaries played at 8/10 or above as a true team.  Talented young players, great calm defending.  Wonderful.

A proud Norfolk boy tonight.’

Chelski won on pens but finished with nine men, elsewhere the Latics beat the Cherries and the Swans beat Wolves all to go through to the 4th round.

]]> Oil price, BP, Zenith, Faroe, Gulfsands, Empyrean, Ophir, Amerisur, Links And finally... Wed, 17 Jan 2018 14:09:00 +0000 Oil price

A down day after the Martin Luther King holiday, probably a bit of a technical correction, $65 and $70 seemed a little rich for the money managers with over a bill tied up in oil…But comments by Russian Oil Minister Novak should have calmed their nerves, he said that the deal must continue as the oil market is still oversupplied or ‘not yet in balance’ to use his words.

The reports will start to come out tomorrow and after, bet on the US production rise being the key point, if you believe that will make a difference you should chuck out another lump of your long. I bet none of them will say that although US production is up again it’s all ok as the sherberts have already sold forward quite a lot at the wrong price…

No, the worst news yesterday was when SocGen, Morgan Stanley, BAML and the Vampire Squids all increased their 2018 oil price guesses, after that for them it was up to bed with no tea…


Like when Christopher Columbus pronounced that the world might be round, they all laughed, when I suggested six or seven years ago that BP might have to cough up ‘in excess of $58bn’ for the Macondo disaster, they all laughed,  they are not laughing now. I was one of a small band of people who worked out that in a litigious society where the perceived enemy was considered fair game, BP was on a road to nowhere.

So it comes as no great surprise that yesterday they added up the numbers again and got to $65.1bn+ for the charge for Deepwater Horizon. Ironically it led to BP starting the asset sale process earlier than others, so were ahead of the competition but it also meant that some of the family silver now resides on the wrong side of the salt, so to speak. My preference for Shell during this time is partly management, where quality will out, but partly as during the oil price crash they were able to hold their breath and buy BG right at the bottom, coupled with that acquisition giving them a chance to restructure, has left them very much in the driving seat.

Zenith Energy

My recent visit to Zenith in Azerbaijan has at least meant that when announcements about wells are made I can picture the scene, today is no different, the Z-21 workover was demonstrated by the excellent Mike Palmer on site before Christmas. So, the workover began yesterday and the coiled tubing unit has been mobilised and will aim for TD of 3,982m where wellhead pressure has built up to 4,300 psi. On  Z-28 the company are awaiting ‘imminent delivery’ of resin compounds needed to seal the wellhead after which activity will start here as well.

Faroe Petroleum

Right at the top of the bucket list you will find Faroe Petroleum, since Ithaca it has been the poster boy of the E&P sector with its historical excellence in drilling success and track record in on time delivery. Today they announce 8 new prospective exploration licences (4 as operator) in the Norwegian North Sea which as they say,  ‘further consolidates their position in the core areas on the Norwegian Continental Shelf’. With existing discoveries being worked on and a material 2018 drilling programme under way I would suggest that there are plenty of reasons to be cheerful, at least if you had a rock band it might be your theme tune…

Gulfsands Petroleum

GPX has announced that it has drawn down the final £1.6m of its secured term financing facility which it believes, with the ‘rigorous attention to cost cutting and capital efficiency’ will last until at least the middle of the year. At some stage the company expects to seek equity  financing which should be easier post the excellent remedial work done on the company by MD John Bell.

Empyrean Energy

EME announce today that production and sales from the Dempsey well in California have commenced at a rate of 140 mcf/d. The operator is proceeding with the application process for enhanced reservoir stimulation expected to start before long. The market has taken the red pen to the EME share price but probably because they, maybe like me, have absolutely no idea what is going on in this well which on the way down was burning the barn down, less so now.

Ophir Energy

Yesterday Ophir had a trading update and stated that the company ‘has reached financial stability’ which is a fair bit more upbeat than I have seen from them lately. Maybe its just a new form of words but having just spent some time with Nick Cooper I think it sums up the feeling that Ophir is in better condition than sometime they get given credit for.

The company ended 2017 with increased gross liquidity and ‘considerable discretionary capital available for investment’, obviously some of this is earmarked for Fortuna but there is enough to make a difference elsewhere in the business. They rightly say that this investment could generate significant cash flow growth and maybe I hadnt spotted this light under a bushel. Negotiations on the funding of Fortuna continue but I am confident that they have enough equity available to do a good deal especially if you look longer term.

Amerisur Resources

Yesterday I took the chance to use my Core London interview slot to have a chat with Amerisur Chairman Giles Clarke, it was a most interesting discussion and the link is below:

Core Finance interview: Giles Clarke, Chairman of Amerisur Resources


On Monday I did my regular Podcast on Voxmarkets, here is the link:

VOX Markets podcast: Malcy talks about Frontera Resources, Rockhopper, Premier Oil, President Energy and Zenith Energy

And finally…

Last night there were a few FA Cup replays in which the Hammers and the Foxes just about got through as did Cardiff, Sheffield Wednesday and Reading. Tonight Chelski host the Canaries, Swansea v Wolves will be tough and Wigan entertain the Cherries.

He’s back! A day or so after being charged with affray Ben Stokes is packing his bags and of to start playing one day cricket for England who have decided that they can’t hold him back any more…

]]> Haydale Graphene signs supply agreement for its anti-counterfeiting technology Wed, 17 Jan 2018 13:24:00 +0000 Ray Gibbs, chief executive of Haydale Graphene Industries PLC (LON:HAYD), tells Proactive they've entered into a commercial supply and development agreement with Australia-listed Talga Resources.

The tie-up will see the two work together to produce, market and sell jointly-developed transparent conductive ink products using graphene for industrial applications in Asia.

The two companies – which have been working together for a few years now – will look to enhance the properties of Haydale’s graphene-based, transparent conductive ink by using Talga’s highly conductive graphitic materials.

]]> Iofina's new IO#7 IOsorb plant to come online within weeks Mon, 15 Jan 2018 14:34:00 +0000 Tom Becker, chief executive of Iofina plc (LON:IOF), tells Proactive their new IO#7 IOsorb plant is nearly complete and should be online next month.

Chatting to Andrew Scott the iodine extractor confirmed that crystalline iodine production in the second half of 2017 exceeded expectations, clocking in at 267.5 tonnes, versus 216.6 tonnes in the same period of 2016.

]]> Oil price, SDX Energy, Wentworth Resources, Velocys And finally.. Mon, 15 Jan 2018 12:00:00 +0000 Oil price
Oil had another good week closing pretty much at the highs and shaking off all bearish sentiments. It is quite frankly quite nauseating to see the bears from leading investment banks and journos trying to pretend they were anything other than totally wrong last year. Ambrose must have written his article last week with clenched teeth and eyes wide shut.
There is little doubt that oil at 65 and 70 respectively may not have much upside, the rig count was up on Friday, 15 overall and 10 in oil and yes, shale production will be up. But where all these writers etc are coming from now is that world GDP growth is going to more than offset that US production, in my view it never was a significant bump in the road. Oil stocks have been coming down and with refinery run rates at record levels and likely to remain so with peak demand for distillates it would be surprising to see much bad news imminently.
As for geopolitical risk, do me a favour, for some just out of short trousers the Shah of Iran is something out of Game of Thrones…

SDX Energy
SDX has announced this morning that it has spudded the ONZ-7 well in the Sebou Permit onshore Morocco. This well is the fifth well in the nine well campaign and like most of the others will only take 10-15 days to drill and, if successful, be able to complete, flow test and connect to infrastructure very quickly indeed. The model at SDX is working well and there is much upside from not only this drilling campaign in Morocco but development and exploration opportunities there and in Egypt. Next week sees an analyst visit to Morocco and I notice that there is substantial interest from the community, some of whom are only just catching up with the SDX story…

Wentworth Resources
Wentworth Resources has announced that it has hired Eskil Jersing as its new CEO to fill the shoes of Geoff Bury. Jersing resigned from Sterling Energy last year so I suppose has the  advantage of being readily available to start at WRL. I look forward to meeting with Mr Jersing as he is in an interesting position given that WRL is so strongly positioned at the moment.

The company has announced another funding, today raising £18.4m through a firm placing, a placing and an Open Offer. This will fund the latest strategy which is to enter the renewable fuels market and develop their second biorefinery in the US. They expect FID on this in mid 2019 so there is plenty of time to assess the new strategy. I recently met with CEO David Pummell and he has what can only be described as significant enthusiasm for this project and it certainly seems to have some legs, let’s wait and see…

And finally…
A fantastic match yesterday at Fortress Anfield which could have gone either way until the HubCap Stealers broke Noisy Neighbours hearts with a short blast which even they couldnt quite come back from. Elsewhere Chelski were held by the Foxes, Spurs easily beat the Toffees and the Cherries saw off the Gooners who predictably given the wont sack Wenger are rubbish. The Red Devils go to the Potteries tonight.
In the NFL, the Jacksonville Jaguars beat the Pittsburgh Steelers to advance to the conference Championships. They face the Patriots on Sunday. The Vikings also beat the Saints last night and they come up against the Eagles for a place at Super Bowl LII.

]]> Exciting News from AIM Journal's 100th Edition Fri, 12 Jan 2018 15:57:00 +0000 AIM Journal writer Andrew Hore tells Proactive that since the journal's inception in 2009, many companies featured on AIM have positively grown. Andrew discusses trading statements on US based construction company Somero and computer games co-developer Sumo, giving Proactive insights into the pertinent facts and figures.

]]> Curzon Energy excited about well tests at Coos Bay project Fri, 12 Jan 2018 12:26:00 +0000 Curzon Energy (LON:CZN) is ready for extensive well tests at Coos Bay coal bed methane project. Executive Director Thomas Wagenhofer tells Proactive how they will now be able to produce wells at better test rates. A five well workover programme has now been completed and outcomes have so far “completely correlated” with the pre-programme technical work, both on time and on budget. Sand and coal was removed from all five wellbores, and old down-hole equipment was also removed. Thomas says over the next few weeks they want to determine if wells can become commercially viable to kick the company off to phase 2, to design up to 58 models in the field.

]]> Oil price, President Energy, Frontera Resources, Zenith Energy And finally... Fri, 12 Jan 2018 10:50:00 +0000 Oil price

There is not much to add on the oil price to events of the week. Yesterday Brent printed above $70 but ended up 80 cents off the top as traders, already long, felt no need to take out the higher resistance levels. It will take something quite powerful to do it but chartists dont worry about that, as a leading expert commentator said this morning, last time we went through $70 it was on the way down…

President Energy

President announces this morning successful completion of workovers of the third and fourth wells at the Puesto Flores field which have ended ahead of time and below budget with payback of the entire four well programme in less than three months. Part of the plan of the acquisition of this acreage was to test previously untested intervals and here they came in in each well ‘substantially’ ahead of expectations. When these wells stabilise the field is expected to be producing 1,700 b/d already significantly up since the campaign started.

Unsurprisingly this means that cash flow and margins are substantially ahead of pre-acquisition expectations with January bringing in net sales of $4.5m. Accordingly plans for the rest of the year in the Neuquén Basin have been expanded to include testing of the Estancia Vieja field and workovers at Puesto Flores as well as a new drilling campaign in the second half of the year. All this capex is fully funded from existing cash resources and cash flow.

The oil price is already up 20% since the acquisition and PPC is likely to realise around $64 a barrel for its January sales, at today’s price the CEO’s promise of strong cash flow and increased margins will be delivered in spades, with two weeks until the bucket list selection PPC is making a very strong case for inclusion…

Frontera Resources

Frontera announced on Wednesday the mobilisation of the drilling rig to its T-45 well in the Taribani field situated in Block 11 onshore Georgia. I write about it today as I wanted to have a chat with CEO Zaza Mamulaishvili which was most illuminating.

The first spud in the three well programme will be the deepening of T-45 and is expected to start around the end of this month. Zones 9, 14 and 15 of the Eldari reservoir will be stimulated and produced together after which the rig will move to the Dino-2 sidetrack and then the same operation at T-39. In each case the zones 9, 14, and 15 of the Eldari reservoir will be stimulated co-mingled and produced together in a similar manner.

Netherland Sewell have estimated that zones 9,14 and 15 of the Taribani complex contain 689m barrels of oil in place of which 103.5m is recoverable. Readers will know that I have looked at this company with interest for some considerable time and only last summer, after meeting properly with the company’s new management  did I start to realise just how vast the potential might be. I am planning to visit Georgia in February as I think that getting some idea of how it works operationally will seal my confidence in what is finally becoming a story with some serious legs.

Zenith Energy

Andrea Cattaneo has never concealed his plans to size up Zenith with potential acquisitions and today he has announced and exclusivity agreement for a number of production and exploration licences in an unnamed ‘Central Asian Country’. A sizeable package of 3,600²km of which 550 is production and 3,050 ‘highly prospective exploration’ and are located in a  prolific oil and gas basin with a proven petroleum system.

Expect more details after due diligence has taken place as well as the arrangement of financing which we are told will be a combination of debt and equity all the time trying to avoid dilution. This is a potentially significant deal for Zenith and apparently with ‘geographical proximity’ to the company’s primary operational interests in Azerbaijan and with the ability to ‘generate significant revenues on a monthly basis’. The agreement runs until April 30th or before if the deal is executed. Zenith is another exciting company in  the sector which is partaking in the current shake up of the international asset base where interesting and potentially value added acquisitions are being found…

And finally…

A brief and finally today, it’s a mad week. In the Prem the undoubted big game is the visit of the Noisy Neighbours to play the HubCap Stealers at Fortress Anfield, the Red Devils play on Monday night, Spurs host the Toffees, Chelski host the Foxes and the Gooners are at the Cherries.

Ir looks like Wenger is selling Walcott to the Toffees and Sanchez to whoever can pay 20 mill, was a 60 mill cheque back in September

]]> Morning Market Pulse - Inflection or correction? Thu, 11 Jan 2018 12:22:00 +0000 Equities are mixed mid-morning, with the UK FTSE making fresh highs, US Futures regaining some lost ground and Germany's DAX underwater after encountering resistance. Investors continue to discuss a bond market inflection that could hurt all asset classes, despite Chinese denials that it might be considering buying less US Treasuries. The UK FTSE is being driven north by Tobacco (9pts, weaker GBP) and Miners/Oil (13pts metals bounce, oil rally) while Retail (3pts, Xmas trading update), Telcos (3.5pts; risk appetite) and Banks (4pts; bond yields calmed) drag. Germany’s DAX underperforms as losses for SAP (MS downgrade), Deutsche Bank (calmer bond yields) and Deutsche Boerse contend with gains for Linde, Continental (rebound) and HeidelbergCement. The FTSE 100 is hugging this morning's fresh record highs at 7760. The DAX 30 found resistance at 13000. Dow Jones Futures are back just shy of Tuesday's 25440 record high. Gold continues to consolidate $1315-$1325.”

]]> Oil price, Premier, Rockhopper, Wentworth And finally... Thu, 11 Jan 2018 12:07:00 +0000 WTI $63.57 +61c, Brent $69.20 +38c, Diff -$5.63 -23c, NG $2.91 -2c

Oil price

Not much to add, the EIA stats were better than expected, a draw of 4.9m barrels v 3.4 guesses but not quite as impressive as the API numbers. Nevertheless crude is slightly better again this morning with $70 Brent within reach…

Premier Oil

A trading and operations update from Premier this morning which continues in the vein of operational excellence which has characterised the company for the last two months. The feature today is Catcher which came onstream on Dec 23rd on time and under budget and is already doing very well. Starting at 10/- b/d it is now up to 20/- b/d and speaking to TD first thing I get the impression that the first two wells are being tested at very good rates indeed. This month means testing of the facilities and of course with flaring restrictions production is held back, but by the end of January expect a significant increase, at $69.20 things are very pleasing.

Elsewhere very much as expected, Zama will be appraised this year and next and Tolmount development sanction is expected this year as well. At Sea Lion progress with contractors is gathering pace and debt is being processed, sanction here is planned by the end of this year. (See RKH below)

Financially things are of course looking up, opex this year will be $17-18, capex of $300m and with the healthy oil price and positive free cash flow, debt repayments are accelerating and the total is now , only,  $2.7bn. The shares have had a great run having doubled since the summer and the slight dip this morning appears somewhat churlish by the market but I’m still very happy to keep them tucked up in the bucket list.

Rockhopper Exploration

Rockhopper has announced a corporate update, timed clearly to be in tandem with Prems as the subject is primarily Sea Lion. Phase 1 continues to move towards sanction later this year with work in the last few months concentrating on the commercial, fiscal and financing elements required to secure the $1.5bn capex ahead of first oil. LOI’s are being signed with contractors for provision of well services, logistics and vendor financing which must be good news . For both PMO and RKH the finance needs to be arranged and I understand things are progressing well on that front. Although debt providers are unsurprisingly cautious after the last few years, the project economics of Sea Lion at around $70 must provide plenty of comfort and it should get away.

Finally at Abu Sennan news on production is good and a ‘full review of its prospectivity’ indicates that there is decent upside and enough to consider further drilling this year.

Finally at Abu Sennan news on production is good and a ‘full review of its prospectivity’ indicates that there is decent upside and enough to consider further drilling this year.

Wentworth Resources

I have been most impressed by WRL in the last few months, production is picking up nicely and guidance is being beaten on a regular basis. Mnazi Bay has seen an increase in demand as K-2 has the first two turbines up and running and increased demand from industrial customers has gone up as well. Accordingly the exit rate at the end of last year was 73.4 MMscf/d with a 4Q ave of 62.2 MMscf/d and over the year 49.1 MMscf/d which is most impressive growth. With 2018 providing another four turbines for K-2 and demand from Dangote Cement likely guidance for the year has risen to 65-75 MMscf/d which looks very achievable.

Finally it looks like things are going to plan at the Tembo Appraisal in Mozambique with farm-out discussions under way and hopes of an appraisal well 3Q this year if those discussions are successful. No mention of filthy lucre in this report but recent announcements have been very positive on that front. I remain increasingly happy with Wentworth at the moment.

And finally…

Chelski and the Gooners drew 0-0 last night in a totally missable game, second leg will provide a finalist one way or another.

The England cricket selectors have proved themselves to be the spineless bunch of useless oafs that we all knew they were. Given the chance to boot out those losers from the Ashes they gave them another job which is more than I would give to them, sack the board has never been more appropriate…

]]> Oil price, Savannah, Tullow, SOCO, And finally... Wed, 10 Jan 2018 15:52:00 +0000 Oil price

Crude continues to rise and my chartist friends are getting desperate as all markers are piling through resistance levels which makes them very nervous. Above $69 on Brent for example the next stop is $71 which is the 50% retracement level, this takes it into clear blue water, after the 2015 highs there is nothing until $100 or more…..

Yesterday’s rise was a combination of geopolitics and statistics, the former as Yemeni terrorists threatened to shut the important Bab al-Mandab Strait, probably easier said than done but close enough to the Gulf of Aden to create local nervousness. The latter was a combination of the EIA publishing the monthly STEO, with first time forecasts for 2019 and the API stats which if reinforced tonight will show that the inventory position is falling significantly.

The STEO report, while showing 2018 non-Opec supply up at 2.03m b/d, also shows global oil demand increasing but by only 1.71m b/d which still gives a call on Opec of only 32.46m b/d, at current rates still giving stock draw. For 2019, first demand estimates are up another 1.65m b/d with global demand of 102.67m b/d by end year and higher than production growth, this is hardly the stuff of the demise of fossil fuels is it? These numbers are franked by the World Bank forecasts, also out yesterday that increased world GDP figures specifically for India and to a smaller extent China. Finally for those who insist on worrying about the implication of US shale production putting a ceiling on the oil price, the EIA happily share my view, ie, output only goes up if the oil price does and vice versa.

Savannah Petroleum

On Monday I attended the Savannah General Meeting which apart from doing the mandatory technical stuff, enabled us to listen to AK giving the first full presentation on the deal, my comments are below but I urge you to take a look at the full presentation which has some great graphics I just can’t reproduce here.

Post the deal SAVP looks like the real McCoy as a full cycle, self funded E&P company. The existing acreage in the highly prospective Agadem Rift Basin in SE Niger is about to be tested as the three well drilling programme is iminent and will give us a good idea of the prospectivity there. The deal means that the company is about to acquire interests in the Uquo and Stubb Creek oil and gas fields as well as a 20% interest in the Accugas midstream business in SE Nigeria. As I said this will make Savannah into a ‘cash flow generative, full cycle E&P company capable self funding all operational activities and paying a dividend’.

The acquisition gives net 2P reserves of 92 mmboe, 2C resources of 44 mmboe and net production guidance for 2018 of >20/- b/d of hydrocarbons.  Accugas comprises a 200 mmscfd gas processing facility and a 260 km gas pipeline network capable of supplying c.10% of Nigeria’s power generation capacity. The process has led to the company raising $125m of equity capital from new and existing shareholders which is a testament to the deal that the management have brought to the table. The scale of this acquisition is significant and should not be underestimated, SAVP’s management have taken advantage of limited competition in the area, seen Seven in distress and completed some deal. In paying $280m to acquire assets with a CPR valuation of $663m and ‘material’ upside potential shareholders should be delighted, this is a ‘unique opportunity’ to acquire a substantial asset package’ There is no doubt that this is a transformational deal for SAVP and its shareholders both in terms of assets and production acquired at an incredibly low cost and comes with  beefed up staffing including directors and investors and will be a welcome addition to the bucket list. I look forward to interviewing Andrew Knot on Core Finance before long.

Tullow Oil

Tullow has issued a trading statement today ahead of figures next month, there is little to add to existing knowledge, free cash flow is $0.5bn above expectations which it should be given almost perfect conditions (hardly challenging) with costs coming down into the bargain. Accordingly the balance sheet has ‘materially improved’ and production guidance is increased slightly with operations, particularly in Ghana going very well.


There is little one can judge about today’s statement from SOCO as the recently leaked potential merger with Kuwait Energy will likely change everything. Historically I have been a big fan of SOCO and indeed KE but the recent corporate bother has changed much, not least how much it is going to be valued at. I’m sure that in due course the SOCO management team will be out and about as and when that happens we will find out whether this is a wise decision or not, watch this space…

And finally…

Yesterday I suggested that Bristol City might have a tricky time at the Etihad in the first leg of the Haribo Cup, however neither side ducked the issue, Pep played a strong side and the Robins did not park the bus like some Premier League clubs have. I mentioned that a number of blog reading City fans went up there, here is the account of just one I received this morning…

I’ll admit my fear was losing by five or six but we certainly didn’t disgrace ourselves. It was fantastic to be part of the huge (7,500+) travelling support, and even the last minute goal didn’t dampen our spirits.

And despite being behind, I’m still quite quite optimistic: as Lee Johnson said, it is only half time. The Robins just need to win one-nil at Ashton Gate and survive the extra time without conceding and the Reds will go through on the away goal! Anyone got a spare ticket?

Tonight the other semi final is Chelski vs the Gooners, neither won in the FA Cup at the weekend so will be fearing either of the other semi finalists should they get through….

]]> Solo Oil chief hails Aminex progress in Tanzania Mon, 08 Jan 2018 13:45:00 +0000 Solo Oil PLC (LON:SOLO) Executive Chairman Neil Ritson describes himself himself as ' really happy' with forward progress for the group’s 25% owned Ntorya gas project, onshore Tanzania.
Aminex, project operator and 75% owner of Ntorya, this morning told investors that it is “actively engaged” with the Tanzanian authorities and with third-party engineering firms, in the advanced stages of planning for the Ntorya-3 well. News here too on processing the legacy seismic on Helium One and at Horse Hill, where timing of long term tests are underway shortly.

]]> Oil price, VOG, Aminex, Ascent And finally... Mon, 08 Jan 2018 13:06:00 +0000 Oil price
Last week WTI was up $1.02 and Brent rose by 90c, forecasts of economic growth were good and international bourses mainly continued to rise. The more of this we can get in the seasonally tricky first half the more likely the oil price is likely to hang on to recent gains. Most of my chartist contacts are expecting a little further on the upside before a correction and today crude is up a bit more. Friday saw the rig count, down 5 overall to 924 and oil also down 5 at 742.

Victoria Oil & Gas
VOG announced late on Friday that it had been informed that GDC had been informed by ENEO that it ‘was not in a position to extend the gas supply agreement’ that had been currently been under negotiation. As a result it had to stop receiving gas from GDC who switched off the supply. ENEO said that the reason for this was that it was due to growing arrears from the Cameroon Government and therefore specifically not a pricing issue.
VOG has said that this is a ‘temporary issue and expects a resolution in the short to medium term’ but clearly will affect GDC for the time being. Apart from a sharp cut back in costs, VOG can accelerate its focus on thermal customer demand in Douala where it already has 30 existing customers, and is already building solutions for new ones, albeit that will take a little time.
Gas is still, after hydroelectric power, the cheapest fuel for power generation in country and in the dry season increasingly one upon which industry and business has become dependent. For this reason one must carefully consider whether the Government, by starving ENEO of money to pay for gas supplies and hence electricity through the grid, is making a wise choice. This will result in load shedding and blackouts which would be increasingly unpopular in what we must remember is election year.
Whilst losing 53% of one’s business overnight is hardly business school protocol, longer term there is much to be gained from this move. It will, as I have said, accelerate GDC’s move into the thermal customer market which it should be remembered carries a much higher margin, and in future lead to significantly less of a reliance on ENEO. After all the Douala and Cameroon energy blueprint envisages the use of not only Logbaba but Matanda gas for power generation and thermal supply to business customers, it is unlikely that this action will have been fully thought through and may yet prove unwise. Having said that it will increase to focus of GDC to engage with other customers across the board and lessen their dependence on a small number of power generators.

A short update from Aminex this morning in which they announce that Ntorya-3 is being prepared to drill ‘as soon as possible’ and rig sourcing etc is being  undertaken. Also at Kiliwani N-1 95 MMcf/d was produced in December and they are getting on with installing compression facilities.

Ascent Resources
AST provide investor comfort this morning by announcing that they have received settlement for their November invoice which gave them net proceeds of €303,181 as expected. November production was 2.1 MMscfd and this number rose to 2.3 MMscfd in December.

And finally…
Time is short but in the FA Cup the Noisy Neighbours, Red Devils, HubCap Stealers all went through, Chelski drew at the Canaries and the Gooners went out to Forest. Good performances by Yeoville, Fleetwood, Posh, Burton and Covo plus others I apologies for not remembering..
Cricket went from bad to worse and due to ITV changing channels so regularly the racing didnt tape…Grrrrr

]]> Aminex releases operations update Mon, 08 Jan 2018 08:36:00 +0000 Aaron LeBlanc, COO of oil and gas company Aminex (LON:AEX) talks Proactive through developments at the Ntorya 1/2/3 wells in Tanzania. The new operations, Aaron explains, will enable Aminex to exploit further multiple leads and assets there in the very near future. See Kiliwani North well updates here too, particularly on a significant recharge happening at the reservoir close to the well bore. Aaron also sets out forward plans for 2018/19 during which time he predicts higher production rates and enhanced profitability.

]]> Oil price, Cabot Energy, Egdon/EOG/Union Jack, Thalassa Holdings And finally... Fri, 05 Jan 2018 11:59:00 +0000

WTI $62.01 +38c, Brent $68.07 +23c, Diff -$6.06 -15c, NG $2.88 -13c

Oil price

A pretty good week for the oil price as all sorts of pressures took their toll and in modest volumes. The rise yesterday was following the EIA inventory numbers for the last week of 2017 which showed a much bigger fall in crude stocks but an equally large rise in products. Crude fell by 7.4m barrels against forecasts of 4.5m and at Cushing by 2.4m barrels which the punters like. However, as expected by me earlier in the week, refinery runs went up again, this time to 96.7% a level not seen since 2005. Confused analysts saw gasoline stocks up by 4.8m barrels and distillates up by 8.9m which is why I was expecting the refinery run rise, the extreme cold weather will call for a lot of heavier product as soon as it can be moved.

Cabot Energy

Cabot continues to please; today they announce the results of the 10-32 Rainbow sidetrack well which has produced at the extrapolated daily rate of 344 b/d of oil. This will be put on production in January at the rate of 200 b/d for reservoir management purposes. This well has ‘exceeded expectations’ and will further improve the project economics, with ten further sidetracks planned 2018 looks most interesting for Cabot.

Egdon/EOG/Union Jack

The curse of Wressle continues to strike as the above partners have announced this morning that at the planning inquiry their appeal has been rejected. The current planning for the existing well site has been retained until 28/04/18 which I suppose gives them a final chance, more if I hear from any of the companies involved.


It has been enjoyable covering Thalassa over recent years but with the completion of the WGP deal their involvement in the oil services business comes to an end, for the time being. With net cash of $21.3m the company is in good nick and followers of the indomitable Duncan Soukup may well still have the chance to make money….


Below are two links to interviews I have done with Interactive Investor to give an idea about the oil price thoughts and a run through a few stocks.

Interactive Investor interview: Risks and themes to drive oil prices in 2018

Interactive Investor interview: Oil shares to keep an eye on in 2018

And finally…

The postponed Welsh Grand National has been re-scheduled for tomorrow at Chepstow and there is a good card at Sandown as well.

Last night in the Prem two magnificent goals meant that Spurs could only draw 1-1 with the Hammers who are looking increasingly more confident.

This weekend sees the FA Cup 3rd round where all the big clubs finally make their entrance. I cant mention them all but the standout fixture is tonight where the Merseyside derby pitches the HubCap Stealers against local rivals the Toffees. The Noisy Neighbours have Burnley and the Seagulls v the Eagles, always big rivals make up other all premiership ties. The Rams go to the Theatre of Dreams while the Gooners are at the Forest, Chelski go to the Canaries and Spurs entertain Wimbledon. Amongst many other such great names as Fleetwood Town, Burton Albion, Carlisle and Yeovil all get the opportunity to be giant killers.

And down under after further wicket giveaways by such as Root and Bairstow and Mo, England are facing another uphill struggle…


]]> Oil price. Amerisur, SDX Energy, Echo Energy, RockRose, And finally... Thu, 04 Jan 2018 09:52:00 +0000 Oil price

A short blog this morning due to pre-arranged media events, anything further following chats with companies etc will be addressed for tomorrow’s blog.

A good day for oil prices but mainly due to influences already mentioned here. In Iran the use of the Revolutionary Guards to quell the rioters may have succeeded temporarily but adds to the problem and the geo-political problems in the area. The US cold snap, also mentioned here yesterday has added to the short-term uncertainty.

Amerisur Resources

An operational update from AMER this morning which shows respectable production growth in line with best expectations. Average daily production was 6,971 b/d with a peak of 7,061 and a year end exit rate of over 7,000 b/d, this gives a calendar rate of in excess of 4,862b/d ahead of guidance. The company gave added information about individual plays such as Platanillo and CPO-5 which will add flavour to expectations, more info later or as appropriate.

SDX Energy

SDX have announced that the KSR-16 well is connected to the sales line and flow testing is expected to commence early next week. An extension to the Lalla Mimouna permit to July 2018 has been granted so that the company can evaluate the results of the upcoming drilling campaign.

Finally the ELQ-1 well on the Gharb Centre permit has been drilled, it encountered 22.6m of reservoir interval and 2m of marginal net gas pay in the Hoot formation. This is not considered to be commercial and the well will be completed and P&A’d. Here the company used low resolution 3D seismic which the company consider to be unacceptable and will ensure that high resolution work is done in the future. Meanwhile the company, who so far drilled three back-to-back successful wells in Morocco which means that the company is on track to achieve its target of increasing gas supply in country by 50% or even more. This well is therefore a minor setback and investors should remain very confident in SDX for the future.

Echo Energy

All successfully passed at the General Meeting yesterday and the shares behaving well this morning. I am speaking to CEO Fiona MacAulay later so will add tomorrow.

RockRose Energy

Having spoken to CEO Andrew Austen lately about blog readers sensitivity about the share re-listing,  he has helpfully announced today that they have submitted a draft of the re-admission document to the UKLA and expect trading to resume in a ‘couple of weeks’. Thanks to readers and to Andrew for getting back to us so all can be squared off.

And finally…

Another mad match last next which ended 2-2 between the Gooners and Chelski, this time the former getting a late equaliser. Wenger saw the ‘wrong’ decision but not the other one, funny that…

Tonight its Spurs v the Hammers before we head for the FA Cup weekend

]]> The Oil price, Pantheon Resources And finally... Wed, 03 Jan 2018 12:28:00 +0000

WTI $60.37 -5c, Brent $66.57 -30c, Diff -$6.20 -25c, NG $3.06 +10c

Oil price

All sorts of influences on  oil and gas prices yesterday, all started well and WTI reached $60.74 and Brent $67.29 before excitement was cooled off. The early buzz was primarily geopolitical with sights of rioting in cities across Iran making investors worried about the oil price but none of these demos are, at least for the time being, going to have any effect on crude oil output. The other ‘hot’ area at the moment has been in Libya where terrorists blew up a pipeline as recorded here, the bad news for oil bulls is that like at Keystone and Forties, pipeline operators are getting better and quicker at repairing the holes and Libya is also back up and running.

Other positive news came from the exchanges, where long positions held by ‘money managers’ ( a great term for spivs I always think) have increased  which for some people seems to make it all ticketty boo. As I explained yesterday, if the cream of US investment bankers can’t get the oil price right, including the vampire squids, how can assorted ‘money managers’?

Finally, just showing how the continent of America can show so much disparity, after only days ago seeing dreadful pictures of California burning we are now seeing content of swathes of Central and Eastern America frozen solid. This has not only pushed the natural gas price higher but demand for distillates is naturally rising faster than seasonal norms which will lead to higher refinery run rates and should raise demand for local crude….

Pantheon Resources

There is no doubt that (LON:PANR)   give us a hard run for shareholders money, indeed CEO Jay Cheatham had to remind them in the statement that the company ‘has discovered commercial hydrocarbons in each of the six wells drilled so far’. So why today’s 30% fall in the share price? Not the fact that they have spudded VOBM#5 which is a development well intended to serve as a producer in due course, it is targeting the Eagle Ford/Woodbine sandstone, ironically what they started looking for in what seems like a long time ago.

So it must be the lack of production volumes at the gas plant, at 3/- mcf/d it is still only at initial testing levels at a time when it should be filling up nicely. First in the firing line is VOBM#3 which has ‘variability’ issues on production owing to it being on the edge of the reservoir, it looks like an acid job here so not much hope for a big increase.

The major culprit is the poster boy that is VOBM#1 which is operating at much reduced rates albeit only through a 12/64″ choke, pressure here does not appear to be a problem but reservoir issues need to be managed as just increasing the choke size is unlikely to give the longer term throughput needed at the gas plant. The surprise appears to be the lower permeability leading to a decline in production, also ‘slugging’ which is a build of of liquids leading to inconsistent production. I hear that this is ‘not unusual’ but that two experts in tight reservoirs have been retained to advise on the situation but similar double A wells have been fracced with good results so that is a likely option. It should be remembered that they have nearly 70′ of pay here and with fraccing permeability should be improved.

As for VOBM#4 It looks as if they will isolate and test all three Wilcox zones, which are analogous with the nearby Jazz field and where pretty much all are fracced, the size of the prize here looked like a pretty significant reservoir on discovery so is very much worth waiting for.

Every time some IR or operational banana skin appears for PANR I am asked if I am going to call it a day and probably should have long ago given that it has been like a carry on film in the making. But Bobby Gray and Jay Cheatham are proper oilmen and what they have found is for real even if the suits havent really helped them. I don’t think the valuation has changed much as a result of this announcement, probably just timing, but if they fail to make the 1 well flow or the Wilcox doesnt work or the 5 well isn’t in the heart of the basin then things change, in the meantime this mug is still watching Carry on up the Eagle Ford.

And finally…

No great surprises in last night’s footy, the Noisy Neighbours cruised past the Hornets, when City score after 39 seconds you know its not your night. The Eagles went to the Saints and came back with all the points, where did Woy hide all that talent managing England eh? The Hammers took a while but two Andy Carroll goals saw off the Baggies who according to Pards are the only team playing too much football over Christmas, if you watched them last night it wasn’t football they were playing…And Spurs ventured into the Principality and took away the points from the Swans under new management.

Tonight it’s the Gooners to entertain Chelski which might be worth watching….

And Mason Crane who sounds like a cake shop is playing tonight for England in the final Ashes test replacing Woakes who has a strain, how did he get that?


]]> Oil price, Range Resources, President Energy, Victoria Oil & Gas, Sundry- Premier-Providence Resources- And finally... Tue, 02 Jan 2018 13:08:00 +0000 Oil price

A very Happy New Year to everybody, fully refreshed (?) I’m back on deck and looking forward to whatever 2018 brings to us. The prices above are effectively the end of year record prices, there was modest trade yesterday in which WTI rallied 58c and the new March Brent contract opened at $66.87.

Way back in June with Brent at sub $45 it took not inconsiderable willpower to abandon my $60 year end target for Brent as discussed in an interview with Jeremy Naylor at IGTV at the time. To end the year at $66.60 with even WTI ending up over 60 bucks was probably at the time little more than a dream. However there are a number of lessons that can be learned from this performance, not the least that in terms of the 1H/2H split, 2018 may be a repeat performance. I suspect that provided that the Opec/Non-Opec deal holds, the more difficult first half for supply and demand should be weathered and further progress can be made later in the year. I am not changing my $65 mid year target for Brent nor my $70 full year number, but as ever external factors will warrant constant monitoring.

Another lesson to learn is that the world’s leading investment banks, usually led by the vampire squids, have been wrong most of the last year, it would be pleasing if their commodity trading desks had taken their own internal guesswork on the oil price.

Back to the present the year did indeed close at the years highs, the last two weeks have seen pipelines such as Forties (scheduled back fully by now) and the blowing up by terrorists of a pipeline in Libya last week keeping a bit of production off the markets, the same was thus of the Keystone problem showing how vulnerable we are with the delivery routes. Also inventory stats last week were particularly positive, the EIA reported crude drawing 4.6m barrels with refinery utilisation up at 95.7% the highest since August. Total stocks were therefore down more than the analysts guesses and totalled 8.7m including a healthy 1.6m draw at Cushing.

This year will not be easy, I am already seeing plenty of valedictory remarks by the stale bears and the first half will be hard going indeed. Political influences will be substantial, as ever and with elections in Russia, Nigeria and Iraq amongst others, key oil producing states will potentially see change.

Range Resources

A trading update from Range who have had a busy year and I would imagine are planning to settle down and deliver on promises made in the past. Today’s trading update is very much a step in the right direction as they reveal that the recent well at Beach Marcelle is on production at a stabilised rate of 120 b/d on a restricted choke of 5/32″. They also say that the waterflood programme is showing a ‘positive trend’ with 40% of current production coming from it at 240b/d. Average production in the last quarter was 629b/d with peak at the end of December of 703b/d. With an active programme planned this year and increased opportunities from the RRDSL rig acquisition as well as from Indonesia Range looks in a much more stable position than for some time.

President Energy

PPC has announced the sale of its non-operated ‘non-core’ beneficial interest in the East white Lake field in Louisiana to Alpha Imperial Corp for $525/-. This releases funds and gives PPC more scope to concentrate on its core assets in Argentina which have already showed a significant increase in production and a substantial work programme for this year.

Victoria Oil & Gas

VOG has announced an update on the Bomono farm-out agreement signed in March 2017 and confirm that they and Bowleven are working with the Government of Cameroon to expedite the deal. SNH has a lot on its plate at the moment but I see nothing sinister in this delay and will be hugely helpful for VOG in the future.


As predicted by the company Premier was able to announce first oil from Catcher on December 23rd, which beat my forecast by a day and a half. This is an excellent performance by PMO and Tony Durrant and his team should be congratulated in bring it in ahead of schedule and nearly 30% under budget. The company have said that it will produce at 10/- b/d for now ramping up to 60/- b/d (50% PMO) by the end of the first half of this year.

Providence Resources issued a trading update last week which contained some interesting nuggets of information. Clearly last year was one of disappointment with the drill bit but there is still plenty to do and 2018 looks interesting. Total has exercised its option to farm-in to FEL 2/14 for a 35% interest and the operatorship which is of significant interest. Total also farmed-in to 50% of the Avalon prospect in June but Cairn, who had an option have let that lapse. Finally re Barryroe the company announce that they are gearing up for drilling an appraisal well at some stage and that a tender for a rig will be issued soon. The company also say that a farmineee has been identified and has been given a period of exclusivity to conclude the negotiations which, if concluded would lead to a ‘multi-well programme at Barryroe’. Now I’m sure that readers of this blog for many years will understand if I dont right now break out the champagne and cigars until the ink is dry on the contract, neither will I be standing on one leg waiting for it to happen, too many broken hearts on this one but closure would demand drinks from TOR…

And finally…

I dont have time for all the footy but the Noisy Neighbours have dropped their first points against the Eagles whilst Chelski and the HubCap Stealers have been on cracking form over the festive season. The Red Devils have struggled to find the net but got back to winning form last night against the Toffees.

Another set of fixtures tonight as aforementioned Noisy Neighbours host the Hornets, the Hammers welcome the Baggies, Spurs are at the Swans and the Eagles go to the Saints.


Muzza has broken down again just before appearing in Brisbane and now very unlikely for the Australian Open, will we see him again I ask?

]]> Oil price, VOG, Columbus, Pantheon, IOG, And finally... Thu, 21 Dec 2017 11:11:00 +0000 Oil price

As we move towards the end of the year the bulls have the upper hand, marginally. Yesterday it was all about inventories and the numbers were mainly good, crude started well after the API stats, faltered a touch and then rose on the EIA data. For crude the draw was 6.5m b’s against a whisper of 3.5 but the total commercial stock draw was over 14m barrels much better than expected. Products built but not hugely and the USA put in a good shift last week consuming 21.111m b/d up 640/- b/d week on week to show that demand remains real. Supply of course does too with production of 9.79m b/d, the highest for 40 years but the increase was slightly lower than expected.

Victoria Oil & Gas

VOG, hot on the heels of yesterday’s announcement has given us an update on its customer supply progress and it looks very good. Five companies commenced gas consumption last quarter including two new thermal users, one taking additional gas and two returning to the fold. Current production figures are very strong with December so far averaging 10.04mmscf/d and peaking at 14.94mmscf/d. ENEO continue to consume high levels of gas under existing contract extensions whilst negotiations on a new contract continue. Progress at VOG is solid and the shares should be a lot higher.

Columbus Energy Resources

A year end update from CERP this morning and another video from the Chairman, Leo Koot, after yesterday’s from SDX it must be catching but again is very well worth watching. (

The update is very positive, year end targets of 550 b/d have been hit and could have been better but good progress nevertheless. Cash flow is positive and another target of being cash flow positive and fully funded for 2018 has also been achieved. I am looking forward to watching Leo and his team next year, he has imaginative plans in Trinidad and beyond.

Pantheon Resources

Pantheon has increased its stake in the VOBM#5 well from 58% to 75%, this has only involved carrying this well. The well is scheduled to spud in early 2018 and is targeting the Eagleford sandstone which if I remember righly is what we came for…

Independent Oil & Gas

IOG has finally settled the Skipper well creditor discussions, due around now. Of the £6.78m due £4.47m is deferred until August 2018 or when the FDP is approved for the SNS developments whichever comes sooner. £1.87m is converted into shares at 19p whilst the rest is being paid from cash resources. All seems set fair now for IOG, who acknowledge the support of London Oil & Gas in this process, they have been excellent backers and should see a good return in the next year or so.

And finally…

Last night in the Haribo Cup the Robins turned over the Red Devils and now face the Noisy Neighbours whilst Chelski go through to play the Gooners in the other semi final.

]]> Oil price, VOG, Sound, Cabot, Hurricane, Savannah Petroleum, BPC, Wentworth, Sundry-SDX-Genel And finally... Wed, 20 Dec 2017 15:09:00 +0000
Oil price
As the market quiets down ahead of the holiday a couple of bullish factors emerge, on the geopolitical front the stakes are rising in the Yemen as yesterday the KSA said that they had intercepted a ballistic missile from there near Riyadh.
After the close the API stats came out and provided another boost for the market, crude stocks fell by 5.2m barrels against the whisper of -3.8 whilst gasoline rose 2m b’s in line and distillates drew 2.9m way above estimates of 870/-.

Victoria Oil & Gas
VOG have announced the La-108 well result as being ‘ahead of expectations’. Initial gas flow rates of up to 15 MMscfd just from the Lower Logbaba (La-107 did 4) were good and it is now suspended ahead of testing the Upper Logbaba sands which may be used for production in the peak season.  Releasing the rig signals the end of the major capital spend and the company can move to the production process, this will include reservoir management to ensure maximisation of reserves. Finally, satisfying the incredible demand from power operators and companies in Douala can step up and highly profitable sales can be made.

Sound Energy
Sound has announced that the preliminary results of the RPS certification have validated the company’s previous mid-case estimate of GOIP in TE-5 Horst alone of 0.65 TCF with a 2C midcase recoverable contingent resource of 377 BCF. Further results are expected early next year and the company remain confident following comments made at their last presentation.

Cabot Energy
After the leak comes the deal, Cabot are acquiring H2P UK for $8.7m which gives them another 25% of the Canadian acreage and a 25% option valued at $4m. Alongside this they have raised $16.5m through a subscription, placing and Open Offer at 5p which places them on a solid footing. This acreage has proved highly successful and this raise will further add to the scale previously impossible and the partners are top notch.
The rebuilding of the former NP has been in my view pretty impressive, at the start, the slow build up of production in Canada was painfully slow but necessarily so. Patience has been required but this deal will go a long way to recreating a company worthy of a very good management team that has got them back to here. I have only one concern, the company’s house broker in a note out this morning is suggesting that some of the proceeds might be used to ‘advance’ the Italian asset base, nothing wrong with that at all but I personally prefer to see most of it heading towards Canada, at least for the time being. So far for Keith Bush and team this has been a good job, well executed and should reward investors.

Hurricane Energy
Yesterday’s comment on Hurricane contained a slight faux pas, as it were. Confusing the Buoy and the FPSO is a schoolboy error, the former needs to be on site West of Shetlands by end 2Q 2018 whereas the latter has a planned sail away from Dubai by 3Q 2018. I still feel as per yesterday’s note that for choice things could be ahead of schedule if that doesnt confuse any more!

Savannah Petroleum
Just as I am going to press there is an update from SAVP with regard to the placing and Seven Energy transaction. It seems that ‘following significant support from the SSNs, discussions have taken place with key stakeholders including certain holders of SSNs’ there are some alterations to the makeup of the financing.
The equity raise will now be reduced to $125m whilst changes have been made to the cash and shares amount previously announced. Consideration of $42.5 million in cash (previously $87.5 million) and $109.5 million in new Ordinary Shares (previously $52.5 million) will now be paid to the holders of the SSNs whilst the lender of the second bilateral facility will receive consideration of $3.5 million in cash (previously $7.3 million) and $9.2 million in new Ordinary Shares (previously $4.4 million). Finally, the S$20m new capital contribution from the SSNs will be exchanged for a new $26.7m Savannah share issuance (previously $25m). Bookbuilding is continuing today as the new details have obviously changed the process somewhat including the price. The ASMA investment is still on the table but not included in the $125m raise.
The new indicated price is 35p which will mean the market cap would be around £313m and placees will receive 0.5 of an unlisted, untradeable warrant with each placing share subscribed for. The only other change is that the use of proceeds changes slightly and three wells will be drilled in Niger and no further 3D seismic will be acquired. This deal is highly complicated by the very nature of the acquisition but should this go ahead then the advantages of Seven and the Niger programme leave plenty of room for upside.

Oil price, VOG, Sound, Cabot, Hurricane, Savannah Petroleum, BPC, Wentworth, Sundry-SDX-Genel And finally...
BPC has announced the results of the external technical audit carried out by Moyes and Co. They calculate ‘aggregate mean volumetrics assessed for the key structures in BPC’s southern licences is a STOIIP of 8.3 billion barrels, with an upside of up to 28 billion barrels STOIIP’. In addition they give a POS of 25-35% which is extremely positive. Applying their recovery factor of 20-40% they get a EUR of 1.66-3.3bn mean and up to 11bn barrels of upside.
BPC has been a poor performer for a long time, this year the peak was 2.25p and the low 0.5p, so today’s 40%+ rise in the shares to 0.975p is good but some way from the best expected by the long-suffering shareholders. This news ticks one almighty box, although people like me have never really doubted the huge size of the structures in the area, more the ability to deliver such a potentially massive project with its mandatory green requirements. Armed with this report from Moyes and Co there is now no longer any excuse for non delivery of a partner, funding, and action, if and when that happens the upside will surely be the reward shareholders have been waiting for, after all current market cap is £15m….

Wentworth Resources
Wentworth has announced this morning that it has received payments from both the TPDC and Tanesco for $2.5m net worth of gas sales during the year. The company express confidence that they will receive paid invoices on a monthly basis evidence provided by today’s news. Probably more important is the news that gas delivery has started to Kinyerezi-2 for the commissioning of the first two (of 6) gas turbines which in due course will see demand of up to 36 MMscfd when it becomes fully operational. 2018 looks like being a most interesting year for WRL highlighted in my note from AOW in October and very much one for the watch list.

On SDX Energy, I notice that Paul Welch has put a message up on his website which confirms my optimism for next year after what has been a cracking 2017. Worth a glance at
Genel has announced that the refinancing of its Genel01 bonds and accordingly ‘With the approved proposal, the Company will reduce the outstanding bond debt from $421.8 million to $300 million by way of an early redemption of a notional amount of $121.8 million and extend maturity through amending and restating terms to a new 5 year tenor’. In quotation marks as I could wrap it up any better but things are looking up for Genel at the moment, I saw the team last week, including Bill Higgs now he is on board and I will be keeping my eyes on them…

And finally
In the Haribo Cup last night the Gooners beat the Hammers 1-0 and the Noisy Neighbours edged through against the Foxes after a penalty shoot out. Tonight it’s Chelski hosting the Cherries at the Bridge whilst the Red Devils travel to Ashton Gate to play in-form Bristol City.

]]> Oil price, Range Resources, Zenith Energy, Hurricane Energy, And finally... Tue, 19 Dec 2017 11:42:00 +0000 Oil price

Mixed fortunes yesterday, Brent rallied when the Nigerian strike was announced and even when it appeared to be off, still gained on the day. I expect more strike action into the new year with elections in January ensuring political grief.

Range Resources

Range has returned from a long suspension and whilst the inevitable selling by investors who had been waiting for this opportunity to happen has occurred I think that when the story is told about ‘new Range’ it will be quite interesting. At the moment there is a well drilling on Beach and I expect the waterflood to be delivering about a third of production going forward.

Expect plenty of news in the new year, a full update on the Indonesia asset should be forthcoming and of course a detailed update on the Trinidad work programme. Along with how the drilling company is going to fit in and create value for Range, complete with a corporate update and an analyst visit 1Q there will be much to hear from the company.

Zenith Energy

Zenith has released an operational update on wells Z-28 and Z-21 in the Zardab field in Azerbaijan. This where I recently visited and despite having some continued technical problems the prize is now definitely in reach. Having cleaned out to 3,574m it can now be cleaned to TD of 3,944m which is a ‘major accomplishment’ and they are ready to run a CTU to TD. They have encountered a leak from the wellhead which is unfortunate but repairable, with the holidays coming up it may be January before the resin compounds are able to be sourced and installed. With the well showing very strong prospective pressure there is a serious incentive to achieve success in the well and it looks like once the repair is completed this may happen.

At Z-21 the civil works are complete and with the wellhead pressure up to 4,115 psi and the workover rig being mobilised right now this also looks very promising. Sorting these historic problems isn’t easy but are potentially very rewarding and the company remains a very attractive play with its low cost model with serious upside.

Hurricane Energy

After the company raised well over $500m in the summer the shares were bound to mark time as indigestion set in and newsflow seemed a bit scarce. In recent days however there has been plenty for investors to get their teeth into with the better than expected CPR followed by news from the visit to Dubai by shareholders and analysts.

The visit was extensive and we had full access to the Aoka Mizu in Drydocks World in Dubai where the transformation is taking place. With extensive presentations on the whole of the West of Shetlands portfolio reminding us of the potential upside and technical evaluations showing how the EPS at Lancaster is on track for 1H 2019 we were ready to see the FPSO.

The advantage of having visited a number of shipyards around the world is one of comparison, in this case Drydocks World came out with flying colours on all fronts. Boxes that need ticking in my view include good quality and plentiful workforce at all levels, above average spec kit, including some of the biggest cranes anywhere and an air of efficiency by the Hurricane operations team. Now, the company line is that the Aoka Mizu needs to sail away by 2Q 2018 in order to be on site ahead of the weather window closing and whilst I dont expect any change of schedule from them, I would say that barring any unforeseen problems they are probably  somewhat ahead of the game at the moment.

As we move towards the Lancaster EPS becoming more of a reality, I expect the Hurricane share price to start to reflect that and whilst I understand that with some, if not most of the potential partners keeping their powder dry it will not fully discount that although speculation should rise in due course. It needs only one potential early mover to change the basis and that should be priced into the shares, accordingly I remain convinced that at below 30p the shares are extraordinarily good value.


Yesterday I had a long chat with Andrew Scott of Proactive Investors. We touched on a number of companies including Echo Energy, Hurricane post my visit, SDX Energy, Savannah Petroleum, President Energy, VOG and Reabold Resources in a wide-ranging discussion about the sector. The link is below…

Proactive Investor interview: Echo Energy resumes trading on AIM after proposed Argentinian acquisition

And finally…

Tonight it’s the Haribo Cup where the Hammers go to the Gooners and the Noisy Neighbours are at the Foxes, will the junior cup provide the chance to end the unbeaten run?


And drug cheat Justin Gatlin is ‘shocked’ over doping allegations regarding his coach in today’s papers, funny that Gatling being in a drug story….

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]]> Oil price, Echo Energy, Zenith Energy, Savannah Petroleum, Hunting, Ophir Energy And finally... Mon, 18 Dec 2017 17:04:00 +0000 Oil price

For a benchmark crude that is facing 2/3 weeks of production down by around 450/- b/d Brent is surprisingly flat, it probably gives off warning signs that the market feels that any temporary shortage of supply can be handled from existing resources. This is not brilliant news for bulls in the market as in the New Year there will have to be an iron discipline to even mark time. Having said that the very fact that around 20x 450/- isnt coming into the market has got to help. With Christmas, month, quarter, half and full year periods coming up there is little for traders to get overly brave about.

Echo Energy

Echo has confirmed its Argentine deal and announces a placing, Open Offer and the suspension of its shares lifted this morning. The deal is as it was first announced on November 1st as a ‘compelling blend of multi TCF exploration potential, appraisal and production’. This is almost an oven ready, de-risked E&P company that can deliver to shareholders from a standing start, indeed I expect drilling and seismic work to be under way early in the new year. Newsflow will not be a problem and looking at what must be conservative numbers neither will be the size of the prospects.

The company are raising £6.4m via a placing of 36.4m shares at 17.5p which was the pre-suspension price and existing shareholders will get an Open Offer in January to subscribe for another £2m worth of stock at the same price. I have written up the deal at length in previous blogs and think that this is an interesting opportunity in a country that is very much a hot destination in the industry.

I managed to have a chat with CEO Fiona MacAulay and the link is here.

Core Finance CEO interview: Fiona MacAulay of Echo Energy

Zenith Energy

I mentioned last week that I had been to visit Zenith Energy and spend some time with Senior management in Azerbaijan, ZEN is a low-cost onshore producer in this mature but substantial oil province. Zenith has production of around 350 b/d with impressive plans to substantially increase this number through development and using technological expertise and has plans to get to 3/- b/d by 2020. The company has very low costs and thus these cash generative assets can work at oil prices significantly lower than those of today.

I visited the Muradkhanli oilfield which was discovered in 1971 and has produced over 16m bbls of oil to date and saw the wells M-63, M67 and M87 all of which are being worked over. The company has decided that there is a need here for electrical submersible pumps and are sourcing these at the moment. The wells have a high water cut but the field performance has so far been predicated on such behaviour and once up and running will be very profitable and close to a pipeline. I also visited the Zardab field where well 2-28 has a high impact workover under way and also well 2-21 which had a freak blow out in October. Pressure here continues to rise and is being monitored before being reentered. The field shows scope for sand management to avoid build up and could become very profitable indeed.

At present Zenith is concentrating on workover of these wells and achieving cash flow from them, in due course ambitions are much higher, with the opportunity to get ahead with an infill drilling programme that could make serious inroads into the substantial reserve base. This will be helped by the fact that Zenith is in the process of buying its own new rig which when on site make a significant difference. That reserves figure of 2P proved and probable is 32.1m in a CPR this year and it carries an NPV of $435m at a 10% discount. You wouldnt have to make many inroads into that to make the company look extraordinarily cheap. Despite publicised difficulties with old Russian wells looking like a fly tipping operation, staff on site are confident of ultimate recovery.

I met with Mike Palmer, COO who is very impressive and also a number of other Senior geologists who are amongst a number of highly respected operators in the region. Senior management, including Andrea Cattaneo the CEO, are clearly not averse to working on site and pooling intelligence in order to improve operational results. Zenith has a good management team, strong enough finances and a very substantial reserve base all of which give the company substantial growth potential. Very much one for the watch list…

Savannah Petroleum

Savannah has announced that it has put in place a strategic partnership with ASMA Capital Partners, who manage the Islamic Development Bank’s IDB Infrastructure Fund II.  The partnership also comes with an equity investment of up to US$90m, of which US$30m will be done initially. With announcements on the price and the re-emergence from suspension expected very soon it is a busy time for SAVP but it all looks highly promising, and looks like a vote of confidence in their deal to have a long-term developmental institution getting involved in the Savannah story.


A trading statement from Hunting this morning, unsurprisingly trading is ‘in line with expectations’ and EBITDA is towards the upper end thanks to Hunting Titan in the 2H. This perforating business is at the heart of the high end onshore service offering and pretty much my favourite part of Hunting. Elsewhere a bit mixed but heads above water and you can see the company working hard to strengthen the balance sheet probably with an eye to a return to the dividend list some time next year.

Ophir Energy

A pre-Christmas Fortuna update from Ophir who announce that they are ‘prioritising’ one of the alternative funding solutions after the disappointment of the Chinese. This time it is a ‘leading asian bank’ for the order of $1.2bn but the bad news is that it won’t happen until the new year.

And finally…

In haste, the gutless spineless English cricketers who spend more time in the bar or in the nick than they do at the crease surrendered the Ashes this morning. Never one to complain about losing fair and square but this was a pathetic capitulation that was almost entirely avoidable…

In the footy the Noisy Neighbours devoured Spurs 4-1 whilst the Red Devils saw off the Baggies 1-2. Chelski beat the Saints 1-0 and the Gooners did the Magpies by the same score. With the Cherries conceding 4 against the HubCap Stealers and Stoke 3 against the Hammers there were plenty of goals around

]]> Oil price, SDX Energy, President Energy, Savannah Petroleum, Amerisur Resources, Sundry-Petrofac-IOG- And finally... Fri, 15 Dec 2017 12:55:00 +0000 Oil price

At this rate with crude up modestly this morning the week may end up being flat or even up a touch, news in the market has tugged the price this way and that reflecting diverse sympathies. The downward pressure has come from agencies reporting higher US shale production and today the EIA  reported that Brazil’s production had reached 3.3m b/d of liquids so far this year which would make them the 9th largest producer worldwide. The inventory numbers provided food for both bulls and bears, the latter didnt like one bit the huge build in gasoline stocks (not unusual ahead of the Christmas holiday) whereas the bulls liked the crude draw, especially at Cushing. Finally, what matters maybe most and that was the closing down of the Forties pipeline taking 450/- b/d off the market for 2-3 weeks for the UK marker crude.

SDX Energy

Another Morocco update from SDX where the KSR-15 well on the Sebou Permit has now been completed and tested at restricted average flow rates of conventional natural gas into the sales line of 7.52 MMscfd and is now on production. The KSR-16 well has been connected to the existing infrastructure and should be starting test production in around ten days. To try and get some perspective on quite how successful SDX have been at the start of this campaign these two wells ‘now exceed our daily commitments of 6 MMscfd on a stand alone basis. We are now very confident in delivering on our planned natural gas sales rates of 10-11 MMscfd in 2018’. SDX has been very successful in 2017 and with a big campaign of drilling planned next year and with upside potential across the portfolio the shares remain remarkably cheap under these circumstances.

President Energy

Another company on a roll is President Energy where they announce today significant workover success from the first two Puesto Flores Field wells,, ahead of expectations. PFO-50 tested new intervals totalling 11m net perforated metres giving production of 400 b/d which is 100% better that pre shut-in output. The formerly producing interval has been repaired and successfully tested but is being kept in reserve for future production  due to the success of the new perforated section. There was always a chance that diligent drilling would find such new intervals and it is good news that this has been found so early on in the drilling process. With the PFO-9 producing at 100 b/d the total current gross field production is around 1,500 b/d with two remaining workover wells yet to come. With the December price to PPC of $60.80 per barrel from this field cash flow is growing and looks increasingly positive, and there is much more to come.

Savannah Petroleum

Months of hard work is coming to a climax as yesterday SAVP announced the indicative price range and formal launch of the placing yesterday. They confirmed that there is to be a placing for institutional investors for the cash consideration portion of the Seven acquisition and that book building has started and is expected to finish today at 5pm. The indicative pricing is 40-50p and at those prices the SAVP market capitalisation would be in the region of £375-400m. The final price should be announced on the 18th +/- and dealings are expected to commence on the 19th. With this transaction close to finalisation and with book building under way SAVP will go into 2018 in a very strong position with substantial production, a stake in a midstream company and significant upside from its Niger drilling campaign which gets underway in Q1. This announcement gives an idea about newsflow and timeline for the transaction, all very positive steps. At that stage I suspect that it will finally take its place in the bucket list initially planned back in June…

Amerisur Resources

Another catch up after my few days away, yesterday AMER announced a Platanillo-27 update, this well is the 4th on Pad 2N to test the northern extension of the field. This is the 21st well of the Platanillo drilling campaign and has been successfully completed as a medium deviation directional well at a TD of 9,600′ ‘on time and on budget’. Log interpretation indicates 12′ of net pay in the U sand formation and 9′ in the T sand, the N sand was not a target in this well.

The company also states that the well intersected the M2 sand and the A limestone and the log data is being evaluated ‘to determine their potential as pay zones’. With a regular procession of good news from AMER and the expected hitting of  production targets which should continue to rise, I am perplexed at the very least why the shares remain at current levels.


Petrofac announced its trading statement yesterday which was in line with expectations at both the profit and debt levels. Order intake is $5.2bn in the ytd and the company is seeing ‘high levels of project activity’ and are ‘maintaining cost competitiveness through operational excellence’. Orders just this week from Basra Oil and BP totalling around $1bn prove that operationally at least PFC is up with, if not ahead of the game.

Independent Oil and Gas has announced that it has received a 12 month extension of its licence for the Blythe gas discovery to end December 2018. With first gas expected in mid 2019 life is about to get busier for IOG and I think that the shares are an interesting play having drifted back in recent weeks.

And finally…

The third Ashes Test in Perth was looking like a strong performance from England until the familiar late order collapse led to a score of 403, probably below par on this track. Failure to build on the centuries by Malan and Bairstow may prove a bad mistake if they can’t get Smith out…

The weekend’s outstanding fixture in the Prem sees Spurs visit the Noisy neighbours, many have tried but few have succeeded in recent weeks…The Red Devils go to the Baggies, the Saints visit Stamford Bridge, the Cherries welcome the HubCap Stealers, the Magpies go to the Gooners and the Seagulls host Burnley.

With good jumps racing at Cheltenham and Donny and the Sports Personality of the Year on Sunday there is something for everybody this weekend.


]]> Oil price, Hurricane, SDX Energy, Pantheon, Genel, Premier And finally... Mon, 11 Dec 2017 12:16:00 +0000 WTI $57.36 +67c, Brent $63.40 +$1.20, Diff -$6.04 +53c, NG $2.77 +1c

Oil price
Even with a decent bounce on Friday the week ended on a downward note, WTI lost $1 and Brent 33c as geopolitics wrestled with inventory oddities and of course the strong greenback encouraged by a likely rate hike didnt help. I am in Dubai for a few days so will try and test the mood out there.

Hurricane Energy - LON:HUR
The long-awaited CPR from Hurricane is out this morning covering all the Rona Ridge assets excluding the Lancaster field and delivered by RPS Energy Consultants Limited. By any yardstick this is a very substantial resource increase, Hurricane’s total 2P reserves and 2C contingent resources are increased by ∼231% to 2.6bn barrels of oil equivalent.

At Halifax, RPS concludes that it has similar reservoir properties to Lancaster, and importantly, similar oil types which may even come from the same aquifer. 2C contingent reserves at Halifax of 1,235 million barrels of oil equivalent is another piece of independent evidence to back the case for this discovery. As for Lincoln, again RPS report that similar reservoir properties to Lancaster and again, similar oil types. This confirms the Hurricane view that the Brynhild Fault Zone separates Lancaster from Lincoln and that the O/W contact is materially deeper than at Lancaster.

Looking at Lincoln compared to Warwick, whilst RPS ‘recognises that they have the potential to be a single hydrocarbon accumulation’ they have elected to take a more conservative approach by evaluating them as separate structures, at least until a well is drilled at Warwick. Nevertheless, RPS give 2C contingent resources at Lincoln of 604m barrels of oil equivalent on its own. With Warwick as yet undrilled, it is assigned prospective resources of 935m stock tank barrels of oil and a chance of discovery of 77% given the proximity to the Lincoln discovery and the Lancaster field, very promising indeed. One can draw from this that whether or not they are separate structures or a single accumulation, the Greater Warwick area are comparable in resources potential with the Greater Lancaster area with a combined recoverable resource potential of 1.5bn barrels of oil equivalent.

I have spoken to CEO Dr Robert Trice this morning and he is clearly delighted with this CPR, he feels it has been done fairly and specifically with regard to Warwick, has assessed the potential objectively. The fact that the same type of oil is prevalent in Lancaster, Lincoln and Halifax franks the company’s initial work and the testing programme. On that note he fully understands that further test wells will need to be drilled and oil will have to be flowed to surface in order to further de-risk the whole project. What can be said is that this independent corroboration of the information that has been placed in front of shareholders over the last two years or so ‘validates the geological model’ and makes Hurricane a very exciting vehicle in the next year or so. I say that because with the plan to go to EPS of Lancaster straight away now looking eminently sensible, the de-risking of the rest of the project could have a significant value add to the company. At this stage they have confirmed that they are ‘committed to achieving maximum shareholder value’ and to monetising the ‘vast resources’ via farm-out and ultimate sale of the company ‘at the appropriate time’, ie when it receives an offer it believes reflects that value to shareholders.

SDX Energy - LON:SDX
SDX has announced that the KSR-16 development well is a gas discovery with 14.2m of net conventional natural gas pay in the Hoot formation. As with previous wells this will be connected to existing infrastructure and on production within 30 days. This is another successful well from SDX and again exceeded pre-drill estimates, this time by around 50%. The rig now moves off to drill ELQ-1 on the Gharb Centre Permit, a recently acquired licence. In the meantime the company expects KSR-15 to be on test production early next week.
This success has allowed the company to ‘accelerate new customer acquisition activities’ and may result in them bringing forward the start of their forecast gas sales. All in all further success for SDX and with ambitious plans for drilling and development across the portfolio I may have to bang on again about how exceptionally good value the stock is.

Pantheon Resources - LON:PANR
An operational update from PANR this morning on the logging operations at VOBM#4 where Schlumberger has completed its work. Electric logs indicated the presence of hydrocarbons in a ‘potentially significant reservoir in the targeted Wilcox formation confirming the natural gas flows encountered during drilling’.
All the usual caveats apply as until flow testing is completed nothing can be taken for granted but this looks pretty good to me. The only drawback is that they are bringing in a cheaper workover rig for that process which will add to the timing of the next news. However, given they werent even looking for the Wilcox this is highly encouraging news.

Genel Energy - LON:GENL
Genel has confirmed that the Peshkabir-3 well has been extremely positive and the field, in the Tawke Licence is now has now tripled to 15/- bopd.I am seeing Genel before Christmas and looking forward to an update.
Premier Oil

The E.ON acquisition is the gift that keeps on giving to Premier and there is plenty more where that came from. Today the company announce the sale of its 30% stake in the ETS pipeline to CATS for $31.6m, for an asset that is totally core it is a great piece of business, not as good as buying the whole E.ON business for $120m in 2016. Even Dick Turpin wore a mask…..

And Finally…
In some haste after last night the Prem looks wrapped up as an early christmas gift for Pep.
In the Champions League draw they got Basel which is ok, the Red Devils got Sevilla, Spurs will play Juve, the HubCap Stealers Porto and Chelski pulled out Barca…

]]> VSA Market Movers - Goldplat Mon, 11 Dec 2017 09:06:00 +0000 Goldplat - LON:GDP
Goldplat   has provided an update in relation to its arbitration with Rand Refinery as well as general corporate activity, both of which indicate positive progress. An agreement on an arbitration process has been determined and dates for the proceedings have been set for June 2018.

Aside from the arbitration, GDP’s operational progress continues to be robust with key development projects running in line with expectations. The elution plant construction in Ghana is on track for before the end of December 2017 as previously indicated while positive progress continues to be made regarding the treatment of artisanal tailings. The Ghanaian Ministry of Mines is actively working with GDP on this project. At Kilimapesa the target for 5.8koz has been reiterated and at this level of production we continue to expect a return to profitability at the asset.

In South Africa, GDP has built a strategic stockpile in excess of a year’s planned production for the carbon in leach circuit. Work is now being carried out to optimise recoveries and therefore profitability. This is further evidence of GDP’s proactive approach towards providing longer term clarity in terms of sourcing material in addition to the dedicated sourcing teams now operating in Africa and South America.

We reiterate our Buy recommendation and 17p target price.

]]> Oil price, Range Resources, Hurricane Energy And finally... Thu, 07 Dec 2017 13:40:00 +0000 WTI $55.96 -$1.66, Brent $61.22 -$1.64, Diff -$5.26 +2c, NG $2.92 +1c

Oil price
A sharp correction yesterday caused by the inventory figures, first the API and then the EIA. It was not crude that caused the trouble, the draw there was quite impressive but the build in gasoline stocks in particular. Refiners upped their runs to 93.8% which drew crude but added significantly to the gasoline stocks, nothing to worry about…

Range ResourcesASX:RRS
Things are beginning to happen for Range who had the drilling company acquisition approved last week and should be on for a reappearance on the market very shortly. Today they announce the preliminary result of well GY 684 on the Beach Marcelle field which was successfully drilled to 4,300′. Wireline logging has completed showing three target zones penetrated with the primary target zone ( the Lower Gros Morne Sands) in particular being better developed than anticipated. Approvals have been sought for perforating and production testing the well.

Hurricane Energy - LON:HUR
Hurricane is following up on its recent formation of a Listing and Governance Committee (LGC) by announcing that it has appointed Spencer Stuart to source a Non-Executive Chairman of the board. This process is being overseen by the Nominations Committee which after this appointment will add further Non-Executive Directors to ensure that the company is compliant with Code Provision B.1.2. Signs of maturity here which are most welcome, this is a growing company and complying accordingly.

This is an important step in the continuing process of HUR growing as it moves to the EPS on the Lancaster development. Investors who are understandably keen for news should find the next few months of significant interest, next week the company is hosting an investor and analyst site visit to Dubai  to view the Lancaster Early Production System (“EPS”) related works in Dubai. The ‘Aoka Mizu’ FPSO (“Aoka Mizu”), and the buoy and turret mooring system are critical to the EPS development and represents a majority of the overall development capex. This and further news on developments, as well as an imminent CPR, should ensure that investors remain confident of first oil from the EPS in 1H 2019.

And finally…
The Champions League was all tucked up before last night so the Noisy Neighbours losing to Shakhtar Donetsk was apparently in preparation for Sunday… The HubCap Stealers made hay in the retreat from Moscow and scored 7.

Tonight the Toffees are at Apollon Limassol which they will probably throw like the last one and the Gooners host BATE Borisov which they dont need to win.

]]> VSA Capital Market Movers - Novo Lítio Thu, 07 Dec 2017 08:41:00 +0000 Novo Lítio (ASX:NLI)
Novo Lítio provided an update on the legal proceedings yesterday. NLI had been progressing through an expedited procedure to protect the 7th December mining license application cut-off date. However, the court in Braga has determined that this is no longer necessary since the vendors Lusorecursos (LR) have submitted an application which protects that date. The court has therefore determined NLI’s rights over the asset may now be determined via the main legal case which will take longer. NLI in response have submitted their own comprehensive mining plan and license application in the event that LR’s application is rejected due to a lack of technical or financial capability.

NLI have indicated that they will provide further updates in the coming weeks.

We reiterate our Speculative Buy recommendation and A$0.2/sh. target price.

]]> Oil price, Savannah Petroleum, Upland Resources, Link And finally... Tue, 05 Dec 2017 14:06:00 +0000 WTI $57.47 -89c, Brent $62.45 -$1.28, Diff -$4.98 -39c, NG $2.98 -8c

Oil price
Yesterday was a little bit like the day after the Lord Mayor’s Show, after the Opec meeting and the rollover of the agreement there was a bit of profit taking and for once Brent was hit harder than WTI. That has put the differential back below $5 but that may be because there were more net long positions in Brent.
The only comment that might have affected the market came Falih himself as in a speech yesterday he said that ‘supply curbs would continue through 2018 even though countries may start discussing when to raise output in the June meeting’. I think he is saying that it will take more than a half a year to reduce stock levels back to five year averages especially as the demand next year as being forecast to be 32.65m b/d in the seasonally weak 1H but up to 34.24m b/d in H2.

Savannah Petroleum - LON:SAVP
SAVP announced an update on the Seven Energy proposed acquisition and its financing. They are intending to raise up to $250m to fund the cash consideration of the transaction and expansion of the drilling campaign in Niger. The placing, to be done by way of a placing with institutional is imminent and will be done in two tranches, one using existing AGM permission and the second after a General Meeting has been held. Readmission is expected this month and the placing is expected to be completed in January and for the transaction as a whole completion should be 1H 2018.
As a reminder SAVP is acquiring 40% of the Uquo and 51% of the Stubbs Creek onshore producing oil and gas fields plus a 20% interest in the Accugas midstream business. (Interestingly the company has agreed and has a term sheet for, a private equity fund investment for the remaining 80% of Accugas, led by AIIM and with the IDB Fund 11 who will pay $60m for that stake and carry SAVP for its 20% interest which will also carry options to acquire more of the midstream business.)  This is a most interesting deal, having the stake in the company gives SAVP ‘visibility of key end customers for its gas’ and these infrastructure funds will become valuable partners. So, aggregate consideration and acquisition enterprise value will be of the order of $270m.  ‘This represents an acquisition cost of US$2.9/2P boe and an overall acquisition EV/capital invested in the assets to be acquired to date of c.35 %’ which seems very attractive to me.

Lloyds Register has certified 2P reserves and 2C resources to be 92 mmboe and 44 mmboe respectively for the two fields at which 2018 production will be in excess of 20/- boe/d. Net free cash flow attributable to SAVP in the years 2018-22 of $88m p.a. plus an NPV10 of $548m. Other notable features from the announcement include a stepping up of the Niger drilling programme from three to five wells, starting in 1Q 2018 targeting >250m barrels of prospective oil resources. The board is being beefed up as well with a new CFO and three high profile industry players joining the non-exec ranks, once this transaction closes Savannah will be a very grown up company indeed and it should be noted that CEO Andrew Knott has committed to investing $500/- in it personally.
Savannah is acquiring a substantial portfolio of producing assets at what seems a very attractive price, with the cash flow that they expect from these upstream and midstream assets they also intend to pay a dividend from 2018 onwards which makes the transaction even more interesting and will undoubtedly put the company higher up the list of international players in the industry.

Upland Resources - LON:UPL
I wanted to catch up with Steve Staley, CEO of Upland Resources following their recent announcement of a farm-in with Corallian Energy for a 40% WI in UK block 11/24b which contains the exciting Wick Prospect and managed to get some time with him this morning. Apart from some UK onshore with Ineos I hadnt really done much work on Upland but SS has a fantastic record in the industry so should be watched very carefully.

Upland have done a lot of prep work on this licence and plan to drill the prospect in late 2018 but with an estimated in-place P50 resources of around 250m bbls it may well be worth the wait. The key risk that has been identified I understand is the fault closure but apparently if the faults seal then this is a very big structure indeed, in fact his words were ‘it sticks out like a sore thumb’.
Fans of Reabold Resources will have more than a passing interest in this as they now have an interest in Wick following the Corallian investment, although guarded about anything until the deals are funded and signed I suspect they are quietly very excited about 2018…

And finally…

The final round of Champions League fixtures and CSKA Moscow come to the Theatre of  Dreams tonight where the Red Devils need a point to top the group and be certain of qualifying… Celtic host Anderlecht and Chelski entertain Athletico Madrid.

The second test in The Ashes was looking all over but England remain in but with a very slim chance of victory tomorrow but don’t stand on one leg waiting…

]]> Amerisur, Genel Energy, Reabold Resources Mon, 04 Dec 2017 09:18:00 +0000 Amerisur Resources - LON:AMER
A flash blog today as I am travelling, will detail more tomorrow. AMER has announced its monthly production and OBA throughput numbers which are in line with my expectations. Average production of 6,051 b/d making 7,037 b/d including Mariposa-1 LTT which will rise substantially. Peak production was 7,217 with OBA throughput of 5,768 b/d and a peak of 7,066. Years exit rate will be over 7,000 as forecast and average just below 5,000 as expected due to Government actions beyond their control.

Genel Energy- LON:GENL Taq Taq ‘encouraging’…
Obviously the company are pleased to have a meaningful incremental producer on the field, but the real encouragement here is in the free water level being at least 145 metres lower than their previous working assumption. I am assuming that they will need time to work out what that means in terms of reserves, production and activity – and will have to put this result in the context of the overall field decline they have seen this year. But it is positive and nice to be on the front foot with Taq Taq after the disappointing news flow over the past couple of years.

Reabold Resources - LON:RBD
Reabold has announced another deal today by which they have paid £1.5m for 29% of Danube Petroleum which has a 50% interest in the high impact Parta licence onshore Romania. The low risk nature of this investment, with two appraisal wells next year for a potential 33 BCF of gas and maybe some oil as well is typical of Reabold’s management style and I expect more to come. I have spoken to Steve Williams this morning and will write up in detail tomorrow. I will also detail the interesting deal done by Upland last week which more than franks their investment in the Corallian acquisition, I spoke briefly with Steve Staley and have a call with him also planned for tomorrow.

]]> VSA Capital Market Movers - Egdon Resources Mon, 04 Dec 2017 08:36:00 +0000 Egdon Resources (LON:EDR)
Egdon Resources has announced that it has acquired a 100% interest in offshore License P2304 from Arenite Petroleum and Eruope Oil & Gas (EOG LN) which runs until December 2018. Located offshore from North Yorkshire, the license area is immediately South of EDR’s P1929 License which contains the Resolution gas discovery. The consideration is a nominal fee primarily covering licensing costs etc although EDR have agreed future staged payments in relation to the completion of successful milestones.

Resolution is mapped by EDR as extending southwards into the new license block and the new block also contains a gas discovery confirmed by historical wells, drilled by Total (FP FP) and Conoco, which tested at rates up to 34mmcfd and 1,280 barrels per day of condensate. At both Resolution and this new discovery there is further prospectivity for deeper gas in the Carboniferous sandstones underlying the proven Zechstein sequences.

EDR has previously indicated that it intends to carry out seismic surveys across the Resolution discovery in order to better target future drilling. The discovery is a significant asset within EDR’s portfolio and we believe that this additional license block will enable EDR to fully exploit the potential of this attractive asset, in our view.

We reiterate our Buy recommendation and 48.8p target price.

]]> Oil price, Victoria Oil & Gas And finally... Fri, 01 Dec 2017 09:49:00 +0000 WTI $57.40 +10c, Brent $63.57 +46c, Diff -$6.17 +36c, NG $3.03 -15c

Oil price
The Opec meeting ended up with what everyone expected, a maintenance of cuts through to the end of 2018. There was a modest tip of the hat to Russia by agreeing to a ‘production review’ at next June’s meeting which may be interesting. There is no certainty that at that stage things will look that much better, after all if Opec’s predictions are right the big call on its production will be in H2 not H1.
Brent expired and the February contract is up 38c this morning at $63.01 which is pretty creditable, WTI is up 28c at $57.68. Given the ongoing worries about non-Opec production I consider the oil price to be in pretty good nick, time will tell as to the efficiency and stayability of shale and oil sands but one has the confidence that if the price falls back their production falls back too. The oil sector should be ablaze, lower costs achieved by expectations of sub $40 oil should mean that over $60 hay should be being made, if not questions need to be asked in the house…

Victoria Oil & Gas - LON:VOG
VOG today announce the completion of the La-108 well at Logbaba which has been delayed by 14 days due to electrical problems. The liner has now been run to TD and cemented in place, the production equipment will be placed in the well and then the rig will be skidded off. The well is then scheduled to be perforated and flow tested and should be on production by mid-December, it is worth remembering that the preliminary analysis of the logs showed 84.5m of net gas sands in the Logbaba formation.
VOG is one of a number of stocks that should have performed way better given the current state of the market. With Opec concluded and the new Brent contract over $63 the market is not behaving efficiently and therefore offers exceptional value in a number of stocks, VOG is one of them.

And finally…
The football World Cup draw for Russia 2018 will be made at 3.20 this afternoon, expect over analysis and the creation of groups of death and the like, usual advice to England fans is not to book hotels for the latter stages…

The Premiership is back this weekend, Sunday sees the Noisy Neighbours host the Hammers and also that day is the Riviera derby between the Cherries and the Saints. Tomorrow the big game is the Gooners v the Red Devils whilst Chelski host the Magpies, the HubCap Stealers are at the Seagulls and Burnley go to the Foxes. The interesting fixture is Spurs going to Watford, if they are to keep up with the leaders a win at the Hornets is crucial.
And racing at Newbury and Newcastle where the famous Fighting fifth is of high quality but short on runners…

]]> Oil price, Sound Energy, Sundry-Sirius Petroleum, Lamprell- And finally... Thu, 30 Nov 2017 11:51:00 +0000 WTI $57.30 -69c, Brent $63.11 -50c, Diff -$5.81 +19c, NG $3.18 +5c

Oil price
Opec day today so we are in the land of guesswork, yesterdays modest fall was in response to the speech by the Saudi Oil Minister who was corralling the Russkis to sign up for the 2018 deal. The price this morning is showing Brent up by nearly 50 cents so is predicting an agreement but given historical lapses do nothing until the announcement is out.

Sound Energy - LON:SOU
Sound has announced exploration volume estimates for Sidi Moktar this morning. The independent preliminary technical evaluation carried out by EG Group of the historical exploration well and the 2D seismic data over the Sidi Moktar permits and the early results are most promising. The results ‘significantly enhance the company’s view of the exploration potential and confirms substantial upside’ in this pre-salt play. EG reports a range of unrisked gas originally in place on a gross basis from a low case of 6.7 TCF through a best case 8.9 TCF and a high case of 11.2 TCF. EG suggest at least three promising leads with substantial opportunities although the company correctly caution against the element of risk attached to these observations.
This is potentially a second material leg to the onshore Moroccan portfolio.  Rumour has it it is only a first step in their plans to consolidate more onshore Morocco so watch this space…

Sundry - LON:SRSP
Sirius has announced that it is finally on the move with regards to the Ororo field with a placing and all that goes with it, more when I have spoken to the company.
Lamprell has done it again, today it announces that on its East Anglia One contract that it has taken a bath on the contract which means a profit warning…Again more if i get a chance to speak to them but there is no email from the company just an announcement on LSE…

And finally…
In the midweek footie all the top sides apart from Spurs won although the Noisy Neighbours left it pretty late last night. Big Sam is walking into a winter wonderland and must be thinking how it all fell into place whilst David Moyes is already under severe pressure…

]]> Oil price, Shell, Ascent Resources, Frontera Resources, Touchstone, Link, ROK'N'OIL And finally... Tue, 28 Nov 2017 12:46:00 +0000 WTI $58.11 -84c, Brent $63.84 -2c, Diff -$5.73 +82c, NG $2.93 +12c

Oil price
With only two days to go until Opec D-Day things are remarkably quiet by historical standards, normally stances are being set and requirements demanded but right now only two things matter, how long will the accord be extended and are the Russkis on board.
How long is relatively easy, the market expects a rollover until the end of 2018 and whilst a cop-out would be ‘let’s check at the May meeting’ that would be a big sign of weakness. As for the Russians then although they hate the idea of subsidising anyone else I think that they will fall into line, after all it is common sense although that rarely has much to do with policy does it?
Physically WTI had a bad day yesterday, operators of the Keystone pipeline found and fixed the leak in Dakota and announced that they would restart the pipeline albeit at reduced pressure. That knocked the recent wind out of the WTI sails and with it the newly acquired back as well as the narrowing differential to Brent. Brent itself acquitted itself quite well yesterday, after testing the important $63 low it bounced and by the close it was 75 cents off the bottom and nearly back in positive territory.

Capital markets day at Shell and now I am no longer invited I can sit in the warm and save five hours of my life not watching presentations. The news is good with recent management moves being vindicated with the cancellation of the scrip dividend being the most obvious sign although the confirmation of the $25bn buy back by 2020 is also very welcome. Organic fcf is up $5bn, by 2020 at $60 it goes up to $25-30bn which sort of validates the faith a handful of us had at the time of the BG bid, others had less faith…The $30bn divestment programme is almost complete and will carry on at $5bn pa for another three years. Shell continues to outperform BP and this statement proves that they are in better nick than them, the giveaway that must have been done with much pleasure, was the scrip which BP couldnt manage yet. I remain happier with Shell for the time being as they appear to be hitting the straps just that little bit faster mainly due to the foresight made in the BG bid.

Ascent Resources - LON:AST 
A red letter day for AST as the IPPC Permit Preliminary screening appeal decision went in their favour. Not only was the appeal rejected but the oppo has been barred from objecting ever again. This means that subject to an Environmental Permit should be forthcoming ‘in due course’ and work can begin on the adjacent processing facility. This will have a ‘significant margin boost’ as the facility will treat and upgrade the gas from the Petišovci field and gas can then be sold to Slovenia and into the European transmission network at up to 50% higher prices.
Colin Hutchinson, Ascent CEO is my guest on Core Finance TV tomorrow morning and of course afterwards the link will be on Twitter and in the blog.

Frontera Resources - LON:FRR 
Excellent news too this morning from Frontera where the Ud-2 well on Block 12 in Georgia has started to flow gas of a quality acceptable for the Georgia national grid. After clean up and a stabilised flow is established the company should have a good idea of flow volumetrics, however the company are clearly confident as they are talking about completing the technical design of an 18km pipeline for natural gas distribution. This news presents significant opportunities for the future from local reservoirs and should they be forthcoming then the potential is indeed very substantial, I hope to visit Georgia early in the new year so watch this space.

Touchstone Exploration - LON:TXP
More production figures from TXP this morning which seem to be a little disappointing in the Grand Ravine block but overall satisfactory. September production was 1,369 b/d and October 1,472 b/d and exiting at a higher rate which is good news. Production from the four wells drilled this year remain strong with 299 b/d in the period and with four more wells being prepared for which should spud starting in January 2018 and the plan is to continually drill deeper in established pools.

And finally…
There is mid-week Premier League football this week as the Seagulls host the Eagles which is confusing for fans singing, Spurs go to the Foxes, the Red Devils are at the Hornets and the Baggies host the Magpies…
It looks like as the Toffees are taking forever making a decision on a new manager as today’s guess of the day is big Sam Allardyce who was a former guess of the day until he got bored…

]]> Oil price, Tullow/UOG, President Energy, WOGW And finally... Mon, 27 Nov 2017 13:21:00 +0000 WTI $58.95 +93c, Brent $63.86 +54c, Diff -$4.91 -9c, NG $2.81-15c

Oil price
Opec week finally comes around and as usual it seems that most of the decisions have been made in advance in order to give the impression of harmony and accord amongst the member states. Obviously, with the Opec/Non-opec agreement there are more meetings to squeeze in ahead of Thursday’s formal session but there  always have been plenty of meetings on the side of the main event.
The only danger I see is if for any reason the expected outcome, which is a rollover for the rest of 2018, does not happen. There is little doubt that such an accord is ‘in the price’ and anything less than that would be seriously disappointing. Clearly the market has got it into its head that Russia are the potential banana skin and that industry leaders last week put significant pressure on Secretary Novak to influence Vlad but I think that the relationship with the KSA is probably stronger, at least for the moment. It hasn’t stopped some of the more childish scribblers using licence and referring to Putin as the Czar of the international world oil industry but there again kids will be kids eh?
The Keystone pipeline repairs are, as I suggested last week, going to take longer than expected to complete and as a result it will be the year end and not the month end when it will be back on stream. This might mean that up to 500/- b/d of crude will be off the US market with consequent effects on the market. One of which you can see above as WTO strengthens (at one stage it nearly breached $60)  and the differential narrows, the other is of course a move into prompt backwardation and a fall in inventories, all good for the oil price in the short term. With US production up at 9.66m b/d they are doing their best to ease the situation, any other time that would have been grist to the bear’s mill but not at the moment.

Tullow/UOG - LON:TLW
I notice that recently listed United Oil & Gas has farmed into a 20% interest in the Walton-Morant licence offshore Jamaica. Tullow has been building seismic data here over the last three years and will acquire more next year. Whilst this is clearly high impact, high risk, frontier acreage it does show that there is continued interest in Latin America at the moment.

President Energy - LON:PPC 
President continues to be active in the financial markets and today announces its first Argentine commercial bank loan with two leading banks in country. They have, with Banco de Credito and Banco Hipotecario arranged an $8m loan over 42 months at 7.5% above Libor. This will be used to defray part of the cost of the recent acquisition of the Nequén assets bought from Chevron and will free up more of the company’s other financial resources and positive cash flow to ‘materially grow its Argentine business as appropriate’.
With over $21m  raised in recent weeks in both equity and debt markets, the company’s flexibility is seriously improved and any reduction in exposure to IYA has got to be good news. Whilst the whole sector is appearing to take little or notice of $60 + oil and share prices are ludicrously low and offering significant value in many areas patience will be needed but when investors do work it out PPC will be one of the first to rally.

World Oil & Gas Week
This time next week hundreds of delegate will have just started this year’s WOGW in London. I am hoping to get along as there is an extensive list of speakers from all parts of our industry. As a member of the Judging Panel for the Awards Dinner on tuesday I know quite how much time is put in trying to select the very best in each category.

And finally…
With wins in the Prem for the Noisy Neighbours, the Red Devils and the Gooners, who yet again won with a late pen, and all of Spurs, Chelksi and the HubCap Stealers dropping points the top of the table has a Manc look to it. At the moment the blue side of the City are going to take some catching though.
The rugby showed how much progress Scotland have made in recent years, it would have been interesting against 15 players but still I expect a comprehensive thrashing of the over confident Wallabies. Next season’s Six Nations now takes on a much more interesting note with the home nations very even, England v Scotland on February 24th 2018 is definitely one for the diary…Elsewhere England were not in cruise control against Samoa but did have plenty up their sleeves whilst the All Blacks as usual beat Wales.
The cricket proved that England have not lost the art of the middle order collapse and the defeat was a spineless, pathetic apology for a professional touring team. The worst thing is that this is about as good as it gets for England who, apart from the obvious selection of KP, have no one else in the draw to lean on, I hear Mark Wood is 80% fit, olé as they say in all the best bars in Adelaide…

]]> Oil price, Ophir Energy, SDX Energy, Cabot Energy, Sound Energy And finally... Fri, 24 Nov 2017 12:44:00 +0000 WTI $58.55 +53c, Brent $63.55 +23c, Diff -$5.00 -74c, NG $2.97 -5c

Oil price
The news this week on the oil price has been as much if not more than a fairly slim number of company announcements, with the Opec meeting next week this may continue to be the case. Spending some time in the true home of oil this week was inspirational and as is often the case somewhere where workovers and recompletions of in some cases fairly old wells can prove highly profitable.
This week has been another good one for the oil market and whilst there is normally a dose of the jitters ahead of the Opec meeting (think Nov 14 and 16…) the main reasons for the price increases have been to do with outages, this time in North America. With WTI heading for $59 and at a two year high, things are looking good over there, even the differential has narrowed sharply to $5 but this may be temporary. The Keystone pipeline, which carries 590/- b/d of crude from Alberta a long way south has been 85% closed due to a leak in South Dakota. Now, while this may be back up and running by the end of this month it has created a bigger than expected inventory drawdown as far away as Cushing, a spike in WTI and increased feedstock costs may draw refinery demand down a touch. The rig count, out early this week due to Thanksgiving has showed another 9 oil units in place taking the current total to 747, given that rigs are now more efficient than ever it is an important number but still unlikely to change the dial that much.

As for Opec the market is expecting an extension of the deal with a likely 9 month increase to the end of next year. Whilst there have been some concerns about Russia which I wrote about recently I suspect the camaraderie between Riyadh and Moscow will overcome greed of the Russian oil barons. However it is important to highlight the new clout that Putin has, although a recent report from RBC, usually fairly moderate, suggesting that he is ‘the new world energy Czar’ is probably a touch racy…

Ophir Energy - LON:OPHR 
Whilst away I noticed that Ophir announced that financing discussions with Chinese banks has been taking longer than expected which has led to the opening up of alternative funding sources which are now ‘at an advanced stage’. The company state that they will select one of the options by mid December 2017 and proceed to FID in 1Q 2018 which may be slightly delayed but not quite the trauma that the headline in today’s Times suggests.
Indeed the Ophir share price has pretty weak in recent months but maybe now that this announcement has cleared the air it is picking up. Whilst I have been a little concerned about such financing concerns I am not at all worried about Fortuna going ahead, comfort would be obtained by a swift closure here which is what I expect. I am having a meeting with Nick Cooper before long and hope to add more after that.

SDX Energy - CVE:SDX
SDX has announced that its KSR-16 well has spudded and will drill for around 20-25 days. Should it be successful it will tie into local infrastructure within 21 days of the rig moving off. This is what has happened to the 15 well and it is now only 10 days away from tie-up.

Cabot Energy - LON:CAB 
I am sometimes not sure if I am imagining yet another announcement from Cabot, they sometimes seem to come almost weekly! However on the basis that it is better to get too much news and not too little you won’t find me complaining. Indeed, as the work that Keith Bush and his team have been doing has transformed the company from an almost impossible situation, it is good to see production from Canada increasing regularly.
Today the update talks about 750-850 b/d in Canada (75% WI) and the 16-05 well sidetrack is delivering 200 b/d on pump. Well stimulation from Blue SPark Energy is being used to enhance production and will be used more. The company also say that further activities before the year end could add another 150 b/d which would be no mean feat. So, onwards and upwards for Cabot and I look forward to commenting on next week’s update….

Sound Energy - LON:SOU 
Whilst writing today’s blog I have been watching the ‘fireside chat’ that Sound Energy have been holding so that their shareholders can be kept up to speed with what their company is up to. Another new development by James Parsons and team who have revolutionised relationships with retail investors in recent years. Unlike a conference call the website opens up to shareholders who have been typing in questions for some time and with CEO, Exploration Director and CFO answering their pretty much every request, a bit like a giant what’s App chat. With well over 600 participants and nearly 200 questions to get through they may be sending out for supplies before long but watching it they seem to have many happy shareholders. Another first #explorersquestiontime

And finally…
Another big weekend of sport ahead of us if you haven’t been tired out by Black Friday…
Football sees the Hammers v the Foxes tonight whilst the big weekend fixture is tomorrow and sees Chelski travel to Anfield, after a gruelling trip with me to Azerbaijan on Wednesday they might be a little tired… Other fixtures tomorrow see the Seagulls travelling to the Theatre of Dreams and Spurs hosting managerless Baggies. Sunday sees Burnley hosting the Gooners and the Terriers entertaining the

Noisy Neighbours.
The autumn rugby internationals finish with England playing Samoa but more interesting may be Wales v the All Blacks and after last week can Scotland beat Australia? Ireland host the Pumas which shouldnt be a problem.
Racing is first rate from Haydock Park and Ascot where Michael Owen is riding today…
The Ashes is now under way and after day two looks fairly even, England need a couple of wickets or it could run away from them.
And F1 closes the season in Abu Dhabi where Vettel has been fastest so far in practice…

]]> VSA Capital Market Movers - Millennial Lithium Fri, 24 Nov 2017 08:49:00 +0000 Millennial Lithium (CVE:ML) has announced that the company has successfully closed the second tranche of its recent C$30m strategic investment by Golden Concord Group (GCL). The second tranche involved the issue of 5.7mn shares to bring a total of 12mn shares issued for the transaction at C$2.5/sh.

There is an agreed lock up period of six months on the shares and GCL have exercised their right to appoint a board member and Mr Man Chung (Charles) Yeung will act as a non-executive director with immediate effect. He has over 20 years of experience in accounting, auditing and financial management. He is responsible for the financial control and reporting, corporate finance, and tax and risk management of GCL-Poly Energy Holdings Limited (“GCL-Poly”) and its subsidiaries.  He is a member of the Nomination Committee, Corporate Governance Committee and Strategy and Investment Committee of GCL-Poly. Mr. Yeung has been a Certified Practicing Accountant in Australia since 1996 and an Associate of the Hong Kong Institute of Certified Public Accountants since 1996.  Mr. Yeung holds a Bachelor of Business degree with a major in accounting from Edith Cowan University in Perth Australia.

We reiterate our Speculative Buy recommendation.

]]> Flash blog, Trinity Exploration, Range Resources Thu, 23 Nov 2017 12:28:00 +0000 Trinity/Range (LON:TRIN, LON:RRL)
It has been announced this morning that the previously announced deal between these companies by which Range were scheduled to acquire Trinity’s West coast assets has failed to obtain regulatory approvals in Trinidad. This means that the deal will be unable to complete by the backstop date of 30th November and accordingly lapses. Whilst this is a disappointment, both companies have other fish to fry.
For Trinity,  as they had other good bidders for the asset they will re-market it but as it continues to perform well and contribute cash there is no hurry. In addition this does not change the investment profile for 2018.
For Range despite being disappointing they too still have an existing large onshore presence in Trinidad and they can focus on their waterflood programme and of course the acquisition of the drilling company. That and the Indonesian deal completed means that there will be no shortage of newsflow for shareholders including obviously the re-listing of the shares expected next month.
Back from Baku tomorrow with a catch up of this weeks news.

]]> Oil price, BP/Cairn/Far, Amerisur, Sound, SDX, Serica And finally... Tue, 21 Nov 2017 12:29:00 +0000 WTI $56.42 -29c, Brent $62.22 -50c, Diff -$5.80 -21c, NG $3.05 -5c

Oil price
A quiet day in the oil bourses in which the problems being encountered by Mrs Merkel meant that the market ended in a listless and slightly concerned manner. This morning the market is up by around 30c, again on very little news. As we run up to the Opec meeting there will be the usual tittle tattle as ad hoc meetings are reported but hold steady for November 30th.

Reuters reported last night that BP ‘is in talks with Cairn Energy about buying a 30% stake in its deep water SNE field offshore Senegal’. According to reports this stake would be valued at around $600m and is awaiting validation by the state of Senegal. This morning Cairn has totally debunked the story calling it ‘nonsense’ although I must admit it had a ring of truth about it. My view remains that should Cairn want to part company with all or part of their stake it carries significantly higher value to shareholders if done when the operatorship is still up for grabs, ie before next spring when it transfers.

In the meantime Far has some good news in The Gambia in which it holds an 80% stake in two offshore blocks adjacent to the SNE field and in the Mauritania-Senegal-Guinea-Bissau Casin. Following a detailed geotechnical evaluation of these two blocks it has completed an assessment of the potential for hydrocarbon resources. An independent resources review conducted by RISC for blocks A2 and A5 in The Gambia supports Far’s assessment.
The combined Prospective Resources for the two blocks have been assessed at 1.1bn barrels (unrisked, best estimate, recoverable 100% basis) with 926.4m barrels net to Far. Far are planning ahead and expect to drill a well in late 2018, meanwhile the farm-out procedure is fully underway. With such a good record in the area and with strong support from partners and shareholders Far must be a most exciting prospect as it starts work in The Gambia.

Amerisur Resources - LON:AMER 
A CPO-5, Llanos Basin update from AMER this morning but realistically there isnt yet much to report. The initial phase of the  LTT on Mariposa-1 started on November 18th with a clean up and it has now been closed for a pressure buildup test. Shortly the well will come back onstream at a commercial production rate which will be higher than any of the numbers during clean up. This is very good news for Amerisur, obviously as what looks like a very good commercial discovery on a large block that might lead to further success but also as a welcome diversification in Colombia. At change from 20p AMER looks exceptionally good value and with some very exciting wells to be drilled in the south to come I expect significant upward movement before long.

Sound Energy - LON:SOU
After I wrote yesterday Sound reported on completion of the Airborne Full Tensor Gravity Gradiometry (FTG) and magnetic survey acquisition in Eastern Morocco. The company report ‘highly encouraging results’ with  a far more detailed view of the deep, thick Paleozoic basin extending over the three permit areas. The survey clearly offers significant paleozoic opportunities and by mid- December the company ‘expects to have an improved understanding of the exploration potential of the licence areas’.
And this morning Sound has said that it has completed 56% of its phase 1 seismic programme at Tendrara in Eastern Morocco. There will be much for CEO James Parsons to say in his ‘fireside chat’ on Friday morning and of course there is a triple bill of Sound, Echo and Coro on December 6th to look forward to.

SDX Energy - LON:SDX 
Results from SDX but there is nothing we dont know after recent announcements on well success in Morocco and developments in Egypt. Revenue growth y/y is very strong and predicted to grow substantially as the benefits of the Circle acquisition become tangible. With a raise of $10m and shareholders incredibly supportive the outlook is very exciting, 2 from 2 wells in Morocco and coming onstream very quickly plus a busy programme in Egypt means I expect a stream of good operational news from SDX over the winter.

Serica Energy - LON:SQZ 
The deal Serica has announced this morning looks like it should be transformational for the company and certainly de-risks its current asset base. The deal also marks the return to Serica of Mitch Flegg who left as COO and returns as CEO after an unfortunate spell at Circle. They have acquired from BP substantial holdings in the Bruce, Keith and Rhum fields in the North Sea and have taken all the BP staff and also have a production sales agreement for the hydrocarbon offtake.
With BP on the hook for substantial elements of the decommissioning, Serica are buying some good assets with little in upfront payments and a significant addition to reserves and production. 2P reserves will rise 16 fold to 50 mmboe and production 7 fold to 21/- boe/d of which 85% is gas. I am looking forward to sitting down with Mitch to look at it in some detail and also to restarting coverage of Serica, after this most interesting deal.

And finally…
Back to the Champions League tonight as the HubCap Stealers are in Seville, the Noisy Neighbours host Feyenoord and Spurs are at Borussia Dortmund. Tomorrow I notice that Chelsea are in Baku, Azerbaijan…..

]]> VSA Capital Market Movers - Edgon Resources Tue, 21 Nov 2017 08:32:00 +0000 Egdon Resources (LON:EDR) has provided an update in relation to the Holmwood prospect where EDR has an 18.4% interest. It was previously announced that Surrey County Council Planning and Regulatory Committee had opted to defer its decision on Condition 19 (the Traffic Management Scheme), requesting further information. However, the license operator, Europa Oil and Gas (LON:EOG), now considers that it is in a position to submit an appeal and resubmit the Construction Traffic Management Plan which meets the requirements of Condition 19. In addition to the resubmission, EOG intend to carry out additional consultations with local Parish Councils and the residents of Coldharbour Lane.

In line with company guidance we continue to expect EOG and EDR to commence drilling at Holmwood in H1 2018 following successful approval of the resubmission.

We reiterate our Buy recommendation and 48.8p target price.

]]> Oil price, SDX Energy, Zenith Energy, Wood Group, Sundry-Conoco-IR pay? And finally... Mon, 20 Nov 2017 13:07:00 +0000 WTI $56.55 +$1.41, Brent $62.72 +$1.36, Diff -$6.17 -5c, NG $3.10 +4c
Oil price
With a decent rally on Friday the falls on the week were almost negated, WTI was down 19c and Brent 79c by Friday’s close which could have been worse. After all it was the IEA vs Opec reports week, I know who I would hire to write a life saving piece of work and the inventory stats were indifferent. The rig count on Friday showed an overall rise of 8 units to 915 but in oil it was no change at 738 rigs.
Venezuela and PDVSA defaulted on their bonds on Friday, there is only so much the Russkis can do to hold the country together. Only 10 days to go now until the Opec and Non-Opec meetings and as usual speculation is rife as to what might happen. The Sunday Telegraph has gone with the line that the aforementioned Russians are spoiling for a fight although I continue to suspect that at the grown-ups level a rollover has been agreed and so expect probably an extension from 1Q maybe for the whole year. That would probably the best expectation but should do the trick as long as adherence remains strong, as they say.

SDX Energy - CVE:SDX
More good news from Morocco from SDX this morning, the KSR-14 well has been tested and has recorded an average flow rate of conventional natural gas into the sales line of 6.4 MMscfd. This well will stay on production for an extended period before being shut-in for ‘pressure build and year end reserve estimate process’. As for KSR-15 connection to the infrastructure is under way and we can expect flow testing to start in early December. The rig is now on its way to the next location.
SDX is certainly not hanging around in this programme, it is determined not to repeat mistakes made by others in the past that didnt deliver when promises had been made. The company has decided that the key to this process is for it to demonstrate to the State, existing and potential new customers, that gas is deliverable in a timely and efficient manner. With these wells, where in some cases they have only perforated half the pay, SDX have already delivered gas and satisfied customers with the ability to increase that as and when appropriate. The company are ticking all the boxes and I would expect a move out of this trading range to happen sooner rather than later.

Zenith Energy - LON:ZEN 
Zenith has announced an operational update from wells Z-28 and 21 in the Zardab field in Azerbaijan. It makes the point, amongst much technical speak, that ‘the operations present exceptional potential but with difficult challenges that we will have to successfully overcome’. The company admit that they are ‘learning as we go along’ without much accurate well data but are confident of success on both wells and are pleased with current progress. I imagine that all will become a good deal clearer during my visit which starts tomorrow.

Wood Group- LON:WG.
Wood Group has announced a ‘multi million $ contract’ to be the operating partner of the SAGE system and the Beryl pipeline for  Ancala Midstream. Wood will manage the day to day operations of the system which transports gas to the St Fergus processing plant.
On a separate note Wood has received some pretty poor press over the weekend as both the FT and the Sunday Times took it to task over plans to increase CEO Robin Watson’s salary by 25% at a time when Wood are laying off workers and seeing profits fall 77%. Wood has 10 non-executive Directors of whom just 3 are on the remuneration committee and could probably do without this, especially if they plan to visit Standard Life/Aberdeen or even Blackrock any time soon, as to what Sir Ian might think about it I hate to think….

I see Conoco got a bit of press about its plans not to invest in projects that need $50 or more oil to make a profit. Having got rid of most of its offshore investments with the intention of concentrating on shale oil in North America and wanting ‘flexibility to deal with oil price volatility’ it’s perfectly understandable but does rather keep their hands tied.
And I couldnt resist the article in the FT which said that male IR executives earn 45% more than women and that the average mens salary is $275/-, nice work as they say….obv not true over here.
Finally good luck to Craig Yeaman a long time blog supporter who has been given a top job at RLAM after a long time at Saracen in Edinburgh.

And finally…
In the Prem the Gooners beat Spurs 2-0 and despite a dodgy free kick probably deserved it. Wins for the Noisy Neighbours,  Red Devils, Chelski, Burnley and the HubCap Stealers meant that other places remained the same. The Baggies, who went down 0-4 to Chelski, have since sacked manager Tony Pulis, not just for 15 points from last 25 games but also for criminally awful football.
The rugby was most interesting, England beat the Wallabies 30-6 but most fun was in watching Michael Cheika fuming at the various decisions and then three late English tries. Scotland went very close to seeing off the All Blacks but the best thing about that game was seeing the magnificent Doddie Weir on the pitch with his kids. Ireland just beat Fiji and Wales scraped past Georgia, also worth noting for the Spring is that France lost at home to the Springboks…

]]> Oil price, Parkmead, Zenith Energy, Cairn And finally... Fri, 17 Nov 2017 10:24:00 +0000 WTI $55.14 -19c, Brent $61.36 -51c, Diff -$6.22 -32c, NG $3.05 -3c

Oil price
The end of a bad week for the oil price as a combination of indifferent inventory stats, belligerent Russians an IEA report that didnt square with Opec’s and topped off by Saudi Oil Minister Khalid al-Falih suggesting that world inventories wouldn’t be below their five year average until next spring. This was probably just to ensure that come Nov 30th the extension is signed, it will be now. The belligerent Russians displayed a lack of working economic knowledge as they wanted to increase production to make more money and reduce costs, I assume that they can double production as if the deal falls then crude could be 30 bucks in no time…
Parkmead Group - LON:PMG 
Results today from Parkmead where increased production from the Diever West gas field to 39 .3 m cubic feet a day gives positive cash flow and greater returns. Cash is a pleasing $34.3m and Tom Cross is maintaining his usual strict discipline. For right or for wrong he has increased his position in the Greater Perth area and activity covering pre-FEED and FEED is under way. I took PMG out of the bucket list in February at over 60p as I couldnt see the market liking the play as much as others, at 37p today I still need convincing that they offer substantial value.
Zenith EnergyCVE:ZEE 
A brief note on Zenith Energy as I am visiting the company’s assets in Azerbaijan next week. I have been waiting for this opportunity for some time as ever since I met with senior management earlier in the year and was most impressed by them and the opportunities in the region. The marginal field strategy in an area rich in hydrocarbons seems to be like other geographies where small companies can make substantial returns for shareholders and with a very low fixed cost base. I shall report back my findings as and when possible.
Cairn - LON:CNE 
I know this is like an old record but I am still hearing that Cairn are in the process of selling around 30% of their stake in their offshore Senegal discovery. My latest gossip, and that is all that it is, suggests that BP will buy that stake and the operatorship of the project. This may make Far Ltd and Woodside to a lesser extent look very smart but who knows, time will tell I may be completely wrong!
And finally…
The international break is over and we return to the Prem where the big fixture is tomorrow lunchtime when the Gooners entertain Spurs in the North London derby. Never needing any pumping up this fixture is now more hotly contested than ever so that’s Saturday lunchtime sorted. Later we see the Noisy Neighbours visit the Foxes, Chelski go to the Baggies and the Magpies are at the Theatre of Dreams. The Sunday fixture is David Moyes’ Hammers debut who visit the Hornets.
Racing today and tomorrow at Cheltenham where there are some great races with some old jumping favourites coming out on their seasonal reappearances.
And of course the autumn rugby internationals with England hosting the Wallabies at Twickenham, the Scots have the All Blacks at Murrayfield, Ireland host Fiji and Georgia are at the Principality Stadium to face Wales.

]]> Oil price, President Energy, Wentworth Resources, Premier Oil And finally... Thu, 16 Nov 2017 10:42:00 +0000 WTI $55.33 -37c, Brent $61.87 -34c, Diff -$6.54 +3c, NG $3.08 -2c

Oil price
More drift yesterday as the Russians play a little politics, odd that…Oil Minister Novak held a meeting with Russian oil companies yesterday and the vibes from the meeting were in some quarters, oil is now $60 do we need to extend the agreement this month? Although they might be ‘unconvinced’ about the need I feel that when we hear from the mechanic  and not the oily rag things might change.
The EIA inventory stats were not as bad as the API might have indicated, a build it was, of 1.9m barrels against a forecast of a draw of 1.8m but the market didnt seem too concerned.

President Energy- LON:PPC 
Things are moving fast in Argentina for PPC who release an update this morning on the Puesto Flores field. The company expects to receive over $3m net cash proceeds from Argentinian sales in November which is most impressive. The workover programme is fully funded and now increased to four wells with more expected next year. It is worth noting that the pay back of the $2.2m capex is expected to be in less than 12 months using the fairly conservative October oil price of $55. With the promise of high margin, profitable operations building for PPC the outlook is extremely positive.

Wentworth ResourcesLON:WRL 
Following up from its recent positive announcements WRL announce that they are restructuring and cutting costs by moving the head office nearer to management and its African assets to London. It may also re-domicile to a European country if appropriate terms were possible. Regrettably MD Geoff Bury is unable to move for personal reasons so the company is engaged in a search for a new CEO.  These efficiencies and corporate cost savings make a lot of sense and as WRL turns the corner in both its African projects the company is set very fair going forward.

Premier Oil - LON:PMO
Plus ça change at PMO as today’s update reinforces production guidance of 75-80/- bopd with a ytd number of 76.6k. Catcher is on track for first oil in December, Christmas Day would be a nice gift for TD and the shareholders. The Huntingdon FPSO extension has been signed extending the life of the field and an agreement has been signed to sell Tuna gas to Vietnam.
In Mexico preliminary discussions indicate a four well appraisal programme will start in late 2018 offering mid term potential for the company. Operating costs are down in line with guidance and 2017 capex is likely to come out at $300-310m against guidance of $325m. No mention of Sea Lion but at north of $60 the words no and brainer come to mind…Whilst on current oil prices, while nothing can be taken for granted, Premier looks in pretty good nick with a good spread of assets in diversified areas and stages of development and could even start paying back a bit of debt next year.

And finally…

A bit quiet on the sporting front but at least life gets a bit easier for Sir Brad for a while…

England’s cricketers are playing their last warm up match in Oz, not much help against largely journeymen on a slow pitch which will be nothing like the test tracks but most have helped themselves to runs this morning. Stoneman got 111, Cook 70 and Root and Malan both got 50’s.

]]> Trump's Rep on the line? Thu, 16 Nov 2017 08:26:00 +0000 FTSE 100 Index called to open +20pts at 7390 (ex-div -14.5pts), to test the ceiling of its 7-Nov falling channel. Bulls are eager for a breakout and bullish turnaround towards 7600 record highs. Bears are expecting another retrace to yesterday’s 7355 lows, extending the down channel towards 7300. Watch levels: Bullish 7400, Bearish 7385.

Calls for a positive start are helped by fresh gains in Asia, shrugging off several days of losses that potentially puts an end to a commodity sector inspired sell-off, giving bulls some hope of a turnaround. Sentiment has been helped by oil finding support, offering respite to the key Energy sector, with further help at hand from sector M&A talk downunder. Telcos and Tech also helped, along with metals prices off their lows to buoy the Miners.

In corporate news this morning Prudential 9-month new business profit +15%, Life +17%, net inflows £12.8bn, helped by Asia. Mediclinic swings to first half loss, talks with Spire Healthcare continue, H2 seen in-line. GKN to book higher US charges than expected, CEO designate to leave immediately. WPP 'More Confident of Media Business in 2018'.

GlaxoSmithKline Trelegy Ellipta Gets EU marketing approval. 3i Group On track to deliver another year of strong growth. British Land says wider operating environment uncertain, but generating healthy leasing interest at good pricing. Royal Mail H1 revenues beat, so does dividend, adjusted profits flat. Premier Oil on track to produce first oil from key North Sea project.

US equity markets closed at their lowest level in three weeks on Wednesday as concerns about Republicans’ ability to pass tax reform plans and an under pressure Energy sector weighed. The Dow Jones underperformed, dropping 135 points as Caterpillar dragged the index lower, while the S&P 500’s Energy sector pulled the index 0.55% lower. The Tech-focused Nasdaq outperformed, although also closed lower.

Crude Oil prices have limped higher overnight following Tuesday’s 2-week lows, however have failed to better yesterday’s EIA-inspired highs. Brent Crude is attempting to regain a $62 handle, however is struggling to overcome falling highs since Tuesday, while US Crude is also battling falling highs around $55.4 a barrel.

Gold has retreated overnight as the US dollar recovers from 3-week lows. The precious metal dropped to an overnight low of $1275 as the greenback attempts to overcome intersecting resistance, however remains a way off Tuesday’s lows of $1270.

In focus today will be tonight’s vote on US tax reform in the US House Of Representatives where President Trump’s Republican party has a clear majority. However, he has a much thinner majority in the Senate, and the upper house is proposing a different bill which includes a delay to tax cuts. Tonight’s vote might thus prove a relatively easy hurdle to clear, still leaving the administration a long way from that elusive first major legislative win. Remember, that hopes of tax cuts have helped fuel much of the recent market rally to record highs.

Data-wise, UK Retail Sales (9.30am) are forecast to have rebounded to flat in October (0.0% vs -0.7%) but fall negative on an annual basis (-0.4% vs 1.6% prev), impacting FTSE retailers and GBP. Eurozone Consumer Price inflation (CPI; 10am) is expected to be confirmed slower in October, both Headline (1.4%) and Core (1.1%) measures still a way off the ECB’s 2% target. Watch EUR.

In the US this afternoon, the US Philly Fed (1.30pm) may have dropped like yesterday’s Empire Manufacturing, while Import Price Inflation slows a touch and Industrial and Manufacturing Production (2.15pm) accelerates while the NAHB Housing Market index (3pm) holds firm, close to seven month highs. All could have a bearing on the USD and US equities, the former impacting GBP and EUR, too and thus European equities.

A plethora of speakers are scheduled to share thoughts today, including the ECB’s Mersch (8:45am), ECB Chief Economist Praet (11am),  Bank of England Governor Carney and a panel of his deputies (2pm), Cleveland Fed President Mester (2:10pm), ECB’s Villeroy and Fed’s Brainard (both 2:30pm), Dallas Fed President Kaplan (5:30pm), ECB’s Constancio (8pm), the Fed’s Brainard once again (8:45pm) before San Francisco Fed President  Williams (9:45pm) rounds off the packed calendar.

]]> Oil price, Savannah Petroleum, Ascent Resources And finally... Wed, 15 Nov 2017 13:35:00 +0000 WTI $55.70 -$1.06, Brent $62.21 -95c, Diff -$6.51 +11c, NG $3.10 -7c

Oil price
Oil bears were out in force yesterday waving copies of the IEA monthly report as if the agency rarely got anything wrong. As long term readers know, my view is that this expensive research company should do what the industry has been doing for some time and that is at least halving in size. Their short term view is diametrically opposite to the Opec one the day before, well it would be wouldn’t it, but it seems to think that next year oil demand growth falls. For the longer term they are actually more positive with the market for fossil fuels continuing to be strong which it puts down to the petrochemical market, interestingly Bo Diddely was talking at a conference this week in which he warned governments not to expect so much from renewables…
After hours the API stats were very mixed, the headline crude figure showed a build of 6.51m barrels, bigger than forecast and they had gasoline building too, by 2.4m barrels although as one might expect at this time of year distillates drew and by 2.5m. The crude number at Cushing drew though, by 1.8m barrels which leads me to think that for some reason US exports had another bad week, let’s see what the EIA say tonight.

Savannah Petroleum - LON:SAVP 
SAVP has announced an agreement whereby it locks up Seven Energy and a good number of its creditors ahead of acquisition of certain of its assets. Today’s announcement is very much a confirmation that the deal is moving ahead and is by its nature aimed at bondholders more of whom are being signed up at the moment. It also tells us that there will be an equity issue, which was to be expected and I assume that having been highly supportive in the past its backers will fully support the management. Having looked at Seven in the past, albeit some time ago it is clear that the assets that SAVP hope to buy are very significant indeed. They are most definitely cash flow generative and what one might describe as being materially strategic assets in the region, it also has the potential upside of the reinstatement of the SAA which is not in the package but where SAVP has an option if it ticks the right boxes.
The release today is clearly only the beginning of the public unveiling of the Seven process and should be considered as such, I expect much more detail in due course and the analysis of the asset portfolio should pleasantly surprise those not familiar with them. I think that these significant assets will transform the company and in a remarkably cost effective way, not many CEO’s would have seen this and have the perseverance to carry it through. Concern of late has been that with the shares suspended there is no time to get a deal over the line before the six month deadline expires.  Whilst I am not informed on such matters, I would be surprised if work on the Aim admission document wasnt a long way down the line, having been prepared through all this time of negotiation and due diligence and the company have a large number of creditors onside already. It is worth noting that company brokers Mirabaud are suggesting that they ‘expect trading in the shares to commence by the year end subject to publication of an admission document and completion of the equity placing’.
This announcement provides the market with a good idea of the size and scope of the deal and how it is to be financed. Although we don’t know quite enough details regarding the full potential or the final costs, it looks to me as if SAVP are buying a substantial portfolio of assets including a midstream business very cheaply indeed.

Ascent Resources - LON:AST 
Ascent has released an export gas production report from the Petišovci field in Slovenia now that everything is up and running. Starting earlier this month the Pg-10 flowed a maximum of 2.1 MMscf/d and the Pg-11A well flowed a maximum of 1.4 MMscf/d, the agreed November maximum production is set at 2.1 MMscf/d and they are producing around 110 barrels of condensate with that. The INA contract states an upper and lower limit on production of 2.1-2.7 MMscf/d for the first two months and 2.2-2.9 MMscf/d for the next ten months for plant capacity reasons, although I understand that should production be able to handle a higher number then INA would likely be takers of more gas. This is especially likely in the winter months so I wouldnt be surprised to see a spike up in December or January.
Having completed the hard yards and entered phase 1 of the FDP AST are now planning re-entry and recompletion of ‘suitable existing wells to further increase production’. This month’s revenue, based on scheduled production will be around €300,000, a figure that could increase if winter gas prices rise or if INA take more gas this season. All in all a very positive start and  with potential upside from higher gas prices, increased production and of course upgrading the wells in the field, Ascent is very much in the ascendant.

Pantheon Resources
It’s been a busy morning, after speaking to Andrew Knott I then had a long chat with Jay Cheatham, Pantheon CEO who as ever was up early. They announced this morning that the gas processing facility in Polk County was successfully commissioned yesterday with wells VOBM#1, 2H and 3 all tied in and are now selling gas. Revenues from this should start late December or early January but although we knew about it seeing is believing and at over 3 bucks for gas and $55 for liquids it is looking good. The plan is to put 15m scuffs through the pipe and carefully manage the well outputs, no opening of the chokes here, they also get valuable NGL’s as well.
The VOBM#4 well is progressing and too early to tell what to expect but we will know before Christmas and it may be a handy addition to the production numbers, if the Wilcox comes in that would be great news. It seems that Pantheon is now actually as they say, an E&P company not just an E company. With revenues of between $1.2-1.5m a month and a successful raise earlier in the year Pantheon are in danger of being able to fund future drilling organically, those who have had the patience to hang on should see a decent rise in the share price…
And finally…
There is no way of making the result between the RoI and Denmark any more palatable i’m afraid as they went down 1-5 at home and won’t make the World Cup finals next year.

]]> Oil price, Range Resources, Wentworth , Touchstone, Empyrean, Sundry GE-Shell- And finally... Tue, 14 Nov 2017 12:27:00 +0000 WTI $56.76 +2c, Brent $63.16 -36c, Diff -$6.40 -38c, NG $3.17 -5c

Oil price
The latest Opec report is so bullish that people can hardly believe their eyes, demand for their crude this year is up 200/- b/d and for next year by 400/- b/d. This would give overall demand for 2018 at 33.4m b/d with a second half of as much as 34m b/d, put into context Opec is currently producing around 32.6m b/d. Now, the market has already priced in quite a lot of this which is I suppose why oil is only just hanging on to these higher levels, much can still go wrong. It is only just over a fortnight to go before the Opec meeting and of course all the other meetings that will happen at the same time with Non-Opec partners and a great deal of optimism is priced into the market. A minimum requirement is an extension of the agreement, let’s hope that the recent rally doesn’t go to their heads…

Range ResourcesLON:RRL 
I met with Range Resources at the end of last week to try to get a feel how things are going on the ground and also in the ever important lawyers offices. It seems as if things are actually going pretty well on all fronts, they announced the spudding of the GY 684 well at the Beach Marcelle field yesterday and I get the impression that the water injection is progressing quite nicely. The RRDSL acquisition is due to be voted on on 30th November which will be followed by a re-listing in ‘December’. The Indonesian deal has completed and will provide significant operational interest next year and the deal with Trinity is going through the regulatory approvals at present.
‘New Range’ as it may finally be nicknamed looks like it may be a good collection of assets, still firmly based in Trinidad with the rig company and a decent portfolio there but the management have clearly decided with the Indonesian deal to give it some diversity which is no bad thing. If the RRDSL deal is approved, and there is no reason to believe otherwise, I get the impression that  re-listing may only be a few days behind it, giving patient shareholders a quoted holding again.

Wentworth ResourcesLON:WRL 
As I found out when meeting with WRL  in Cape Town recently, things are really beginning to pick up for the company and I suspect that this may be more than just one to watch. Today they provide 3Q results which in themselves are relatively meaningless but production numbers are positive and the direction is important. 60 MMscf/d from Mnazi Bay in Tanzania is the strongest in the company’s history and it puts them in a ‘dominant’ position in the Tanzanian market place which has significant demand from power generators and industrial users. In a market that has a reduced supply of gas by peers, yet has demand coming through from K-2 and the Dangote Cement plant (which should add between 10-60 MMscf/d by the end of next year) the economics stack up pretty well.
Regarding getting paid things are also looking up, admittedly receivables have ‘stabilised at 4-5 months’ but TPDC are paying more and overall payments in the quarter were $5.18m and indeed a payment of $2.6m has recently been initiated by TPDC for the October invoice. Speaking with Vice President, Corporate Development, Katherine Roe today I got the impression that the movement is in the right direction and that the TPDC were making payments more regularly and of a bigger size than before.
Re the company’s oil and gas concession in Mozambique things are also moving at a pace with drilling planned at Tembo-2 for 2Q 2018. I wrote in detail about this whilst in Cape Town but the prospects here are significant and with the distinct possibility of one or more industry partners joining WRL there is further upside potential. 2018 looks like being a landmark year for Wentworth and I for one will be watching most carefully.

Touchstone ExplorationLON:TXP
3Q figures from TXP today which show further growth as production is lifted to 1,437 b/d which is up 8% q/q and 13% y/y. This includes 1 well and 3 recompletions which are to be augmented by 4 more wells in a programme starting in December 2017. With an operating netback of $24.46 per barrel, up by 25% on the 2nd quarter and by 29% on last year’s 3rd quarter the company are confident of growing the business.

Empyrean - LON:TXP 
It is difficult to know quite what to make of the EME announcement which shows ‘sub-commercial gas’ in the lowest zone of the Dempsey well which is testing at the moment. Clearly this is a poor sand but I hadnt expected this as I thought the lower discoveries were the best, but the company remain ‘optimistic’ so I’m sure there is no reason to panic. I may see if I can locate Tom Kelly and ask him…

For those in the oil industry I suspect the fall from grace of the once mighty GE is no great surprise, in recent years the exposure to the oil industry has been questionable at best.  Having said that it leaves a quality company in Baker Hughes in an invidious position as the JV will likely take some time to unravel and as I see it the parent has a serious problem to address over the next year or two. The good news is that if GE Oil and Gas was a competitor, throwing good money after bad to win market share that war is now over.
Shell has sold its entire stake in Woodside as part of its stable cleaning exercise. Yesterday they sold their entire holding of 13.28% of the company for $2.7bn, having initially wanted to sell only a portion strong institutional demand led them to sell it all. This means that Shell are a long way to completing their disbursement strategy ahead of time.

And finally…
Italy will miss their first World Cup since 1958 after failing to score against Sweden last night, this evening the RoI play Denmark after a 0-0 first leg.
The Toffees are trying to lure Watford manager Marco Silva as their new manager although he has only had 11 games at the club, whatever next eh?

]]> Oil price, SDX Energy, Amerisur Resources, Trinity E&P And finally... Mon, 13 Nov 2017 10:32:00 +0000 WTI $56.74 -43c, Brent $63.52 -41c, Diff -$6.78 +2c, NG $3.21 +1c

Oil price
Despite the EIA inventory stats disappointing slightly and the rig count showing a rise of 9 oil units, the oil price acquitted itself fairly honourably last week. WTI gained $1.10 and Brent $1.45 which we can probably put down to geopolitical events. With the MbS round up continuing and an escalation in the tension between the KSA and Iran this aint going away. Before long the Non-Opec and Opec meetings will be upon us, and with the Saudis leading by example, the stage is set for an extension of the agreement and possibly further cutbacks.

SDX Energy - LON:SDX 
SDX has announced another gas discovery, this time at their KSR-15 development well on the Sebou Permit in Morocco. They encountered 17.2 metres of net conventional natural gas reservoir section across 4 intervals and the Hoot Sand, their primary objective had average porosity of 29%. This is the highest rate in the basin and exceeded their pre-drill estimates. The well will now be connected to the nearby infrastructure and should be on production in December. With two wells now successfully drilled,( the KSR-14 well should start testing this week)  the company’s strategy of increasing local gas sales in Morocco by 50% by 2018 is getting much closer. SDX continue to deliver and with an exciting portfolio of prospects in both Morocco and Egypt the outlook is very promising, cheap as chips as I have been know to remark…

Amerisur ResourcesLON:AMER 
A short and sweet Colombia operational update from AMER this morning. The Plat-27 well has been spudded on Pad 2N and should be complete in around 30 days. This is an appraisal well to access the northern part of the accumulation discovered by the Plat-22 well. They have also heard from CPO-5 that the inspection is complete and the long term test should begin shortly.

Trinity Exploration & Production - LON:TRIN 
The good news from Trinity just keeps on coming. With today’s Q3 operational update we get a continuation of the increase in profitable production and further strengthening of the balance sheet where there is cash of $12.3m. Production wise the quarterly rise is 7.4% to 2,506 b/d with all the usual methods delivering the goods. Recompletions, workovers, reactivations and swabbing have provided all this with not an exploration well in sight, yet. Indeed we can expect more as the October figure was 2,754 b/d making the current quarter look potentially better again.
Trinity remain highly disciplined on costs, every time I meet Bruce or Jeremy some poor supplier has taken a hit and they are also hedging through a zero cost collar structure to protect some of the downside. The way that the Trinity team have gone about restructuring the company is as good as i’ve seen lately and this is paying off in a big way. As Bruce Dingwall said recently the company pride themselves on genuinely profitable barrels with some of the lowest net costs in the sector which is why they are looking so good now.

On Friday I did a Proactive Investors interview in which I talked about Hurricane, Echo Energy and Reabold Resources, the link is here.

Proactive Investor interview: Listing upgrade ‘the sensible next step’ for Hurricane Energy

And finally…
Last night Northern Ireland could only draw 0-0 with Switzerland making even more of a mockery of the incorrect award of a pen in the first leg which sent the Swiss through.
The rugby was a bit mixed, Ireland were very good in stuffing South Africa whilst England made heavy weather against the Pumas. Wales were beaten by the Wallabies whilst Scotland just beat Samoa in a high scoring game.

With Vettel winning in Brazil he must have been thinking of what might have been but Hamilton was coming from the back of the grid. Final stop will be Abu Dhabi where it would be great to see a wheel to wheel race from the start.

In Valencia the MotoGP season came to a fitting end when Marc Marquez won the World Championship for the 4th time. After a stunning season challenger Dovizioso couldn’t keep up with Marquez and unfortunately finished in the gravel. The race was won by Marquez’s teammate Dani Pedrosa from Johann Zarco (a ‘satellite’ rider and definitely one to watch in 2018) and Marquez, despite a near off and a miraculous save, managed 3rd with enough points for the title . First Brit home again was Cal Crutchlow in 8th. (And big thanks to John Rimmer who has kept me in touch with the MotoGP season, you knew it couldnt be me!)

]]> VSA Capital Market Movers - Millennial Lithium Mon, 13 Nov 2017 08:27:00 +0000 Millennial Lithium (CVE:ML)
Millennial Lithium has announced a strategic investment by Million Surge Holdings, a wholly owned subsidiary of Golden Concord Group Ltd, one of China’s largest service providers in clean energy.

Million Surge will acquire 12m shares via two tranches for an aggregate amount of C$30m at C$2.50/sh. The initial tranche totals 6.3m shares representing 9.9% of the issued share capital while the remaining 5.7m shares will be issued upon completion of the TSX clearance process for new insiders. The total holding of Million Surge is expected to represent approximately 17% of the issued and outstanding common shares. GCL has a right to nominate a representative to the BoD whilst it holds 15% or more of the outstanding share capital of ML.

The proceeds will be used to advance the development of ML’s lithium brine projects in Argentina.

We reiterate our Speculative Buy recommendation.

]]> Oil price, Independent Oil & Gas, Reabold Resources And finally... Fri, 10 Nov 2017 10:11:00 +0000 WTI $57.17 +36c, Brent $63.93 +44c, Diff -$6.76 +8c, NG $3.20 +3c

Oil price
Oil news yesterday was again mainly concentrated on Saudi Arabia who started giving details about the round up over the last few days. Apparently over 200 people have been brought in and over $100bn of missing public funds are being investigated. It looks like there is a link to the Lebanon here as the case crosses international borders.
The KSA also added fuel to the oil price flames as they announced yet another export cut, December liftings will see another 120/- b/d from sales to clients over November which will add to the comfort of the bulls.

Independent Oil & Gas - LON:IOG
IOG has announced that following up from the recent CPR on Harvey, ERCE has added a fully risked ‘expected monetary value’ (EMV) of £79m. This is their technical detail on the analysis. ‘The EMV has been calculated on the mean of the Low/Best/High estimates of the prospective resources following the derivation of Harvey production profiles.  Low/Best/High estimates of unrisked prospective gas resources are 45/114/286 BCF on the Harvey structure, 36/90/226 BCF on licence’. IOG state that they see a ‘compelling’ case for drilling Harvey, and who wouldnt to be honest, with a planned appraisal well in 1H 2018, FID in 1H ’19 and first gas in Q1 2021.
Provided IOG can finance this and the other SNS gas hubs, and there is no reason now why that cannot happen, then progress from here should accelerate and a highly profitable development should soon be under way. With UK demand for gas very strong and costs still under some pressure IOG would be well advised to kick on as soon as is practicable and with a market cap of just £23m the upside looks substantial.

Reabold ResourcesLON:RBD 
I met with Sachin Oza and Stephen Williams of Reabold Resources yesterday, after their first deal announced last week I was delighted to be asked in to hear about their strategy going forward. Both are former analysts at M&G where they have gained a deep knowledge of the oil cycle and how best to invest in what they call the value chain and have been planning an oil fund of their own for some time. Now, with strong investor backing in the Reabold vehicle they are finally on their way as demonstrated by the Corallian deal last week. The team see the opportunities of investing at the low part of the cycle when costs are low and other buyers are few and far between.
Assets they are looking at are normally at the cusp of production with appraisal planned and little exploration risk. In many cases a huge amount of work will have been done by the existing owner and this far outweighs the value of a CPR or other forward looking work. These assets are in Europe but are not confined to projects like Colter or even the North Sea, I get the impression that RBD has looked extensively on the continent. They look to work in tandem with current owners of the assets they invest in and find generally that their injection of capital is welcome when others are not putting up the money. At the moment the investment size sweet spot appears to be between $2-5m for RBD but after initial deal I can see other partners investing in the assets as they progress. The next step would be to up the ticket size to say, $5-10m, after a few of these one can start to see the earlier investments bringing in revenue.
Whilst this is early days for Reabold I find this investment model pretty appealing, they have plenty of experience in the sector and are backed by a number of genuinely supportive investors. At the size they are looking at I should imagine that there are plenty of deals around, so the idea that for the foreseeable future investors deal flow and operational updates should be pretty regular. Whilst these words are only a short look at RBD I expect to be hearing from, and writing about, the company a lot more in the not too distant future, indeed they have a large and growing retail following as I can testify to following announcement of my meeting with the team yesterday.

And finally…
The international break is upon us and we don’t look at ridiculous friendlies either, feel sorry for Northern Ireland who got a shocker of a pen decision and go to Switzerland on Sunday 0-1 behind. It will give them no comfort to know that the England – Germany farce tonight will have a video ref… Tomorrow the RoI are in Denmark for another tricky encounter…
Racing is at Aintree and Wincanton as the jumping season really kicks in.
And in F1 with Lewis already champion the Brazil race is relatively meaningless but i’m sure that it will still be most exciting with young Max V trying to add to his recent tally.
Sunday sees the final round of this years MotoGP where Marquez should capitalise on his 21 point lead over Dovizioso but the Fat Lady hasn’t sung yet.

]]> VSA Capital Market Movers - Independent Oil & Gas Fri, 10 Nov 2017 09:11:00 +0000 Independent Oil & Gas (LON:IOG)
Independent Oil & Gas has announced an update in relation to the Harvey license area. Following the release of an upgraded resource for the field IOG has now provided an updated valuation estimate. The best estimate for the resource was 114BCF although with c21% of the resource off license, the volume attributable to IOG is currently 90BCF. We note, however, that the company is looking to license the entire resource.

With this significant resource alongside the Thames Pipeline strategy which materially reduces the infrastructure capital requirements the economics appear attractive, in our view. Based on the best estimate resource and using a 10% discount rate for the entire structure the NPV comes to £159m with an EMV of £79m whilst on IOG’s license area the NPV is £126m with an EMV of £63m assuming 50% CoS in each case. The CPR assumes dry hole costs of £8.5m for the planned well. This is, in our view, has the potential to be the most attractive prospect within IOG’s portfolio. IOG is progressing plans to drill as soon as possible although has made a firm commitment to drill within two years.

We reiterate our Buy recommendation.

]]> Oil price, Hurricane Energy, Genel Energy, Victoria Oil & Gas, Aminex And finally... Thu, 09 Nov 2017 09:42:00 +0000 WTI $56.81 -39c, Brent $63.49 -20c, Diff -$6.68 +19c, NG $3.17 +2c

Oil price
As one might have expected the oil price has consolidated at these higher levels. The API stats were not as good as expected and last night’s EIA inventories showed a build of 2.2m barrels against expectations of a similar sized draw. Under these circumstances the modest fall was probably better than might have been expected.

Hurricane Energy - LON:HUR 
A couple of announcements from HUR this morning, they are considering a change to a ‘premium segment of a recognised exchange’ which would be a more appropriate platform for growth, raise their global profile increase liquidity and ‘provide a wider addressable universe for the shares’. This makes perfect sense, the company has a market cap of nearly £600m, has just raised over $500m in debt and equity and has a substantial development programme over the next two years or more. With a revised CPR imminent, which will include Lincoln and Halifax,  the company is poised to grow significantly and I continue to believe that the shares are excellent value and my target price remains over 100p.

The other announcement is that Non-Executive Chairman Dr Robert Arnott has resigned with immediate effect and Dr David Jenkins will step in as interim Chairman until the post is filled. The listing and governance committee, which has been announced this morning, will include recommendations as to the size and composition of the board amongst other important factors for the future of the company.

Genel Energy - LON:GENL
Genel has announced that they have struck a deal with the Moroccan Government regarding their Sidi Moussa offshore licensed acreage. Under the deal instead of one committment well Genel with only have to carry out a 3D seismic campaign which should re-risk the prospectivity of the licence. All perfectly sensible under the circumstances. Secondly they have announced that the Peshkabir-3 well on the Tawke PSC is on extended production testing and has flowed in excess of 3/- b/d of oil on a 64/64″ choke.

Victoria Oil & Gas - LON:VOG 
In a Logbaba update yesterday VOG announced that the La-108 well had reached total depth of 2,865m MD and encountered 84.5m of net pay in the Upper and Lower Logbaba formations. This number exceeded pre-drill expectations and are significantly more than the La-107 well which had net sands of 58m and produced at 54 mmscf/d . Flow tests are planned ahead of this well producing by the end of November. The drilling campaign here is now finished, it has been a long haul with some ‘interesting’ moments but has ended with success, next stop La-109.

This success will provide significant additional reserves for GDC to market into the gas hungry Douala region where it should be remembered they are the sole supplier to power generator ENEO and other substantial industrial thermal clients. As the company says, ‘this will enable the company to conclude longer term contracts with our Douala high-usage customers’. Demand for gas in the Douala Basin exceeds 150 mmscf/d, with this additional supply and the extra potential from Bomono and Matanda where significant capex is planned and will be financed by the recent successful raise prospects are very exciting. I continue to believe that the value in VOG is still substantially underestimated by the market and its value has yet to be fully realised.

Very briefly I notice that Aminex has signed up John Bell as a non-exec Director, this is very good news for both parties as he is an experienced and very talented oil man. Currently running Gulfsands Petroleum and doing a good job there JB will add a great deal to Aminex.

And finally…
A huge night for Northern Ireland football as they play the first leg of their qualifying play off game against Switzerland tonight.
Equally big is the task for the England womens cricket team who must win their Ashes test if they are to avoid conceding the series. As I write, batting first under the lights they are 177-3.

]]> VSA Capital Market Movers - Novo Lítio Tue, 07 Nov 2017 08:36:00 +0000 Novo Lítio (ASX:NLI) has announced that it has completed the acquisition of a significant land package in Northern Portugal from Medgold Resources (MED CN) as per the previously announced conditions. The land package is highly complementary to the Sepeda project with multiple known tin-bearing pegmatite outcrops as well as multiple historic workings. NLI paid EUR167.5k for the tenement package.

Crucially, the tenements already have licenses granted and therefore it is not possible, as in the case of other unlicensed sites in Portugal, for other parties to put in additional license applications whilst the grant process is ongoing. Given the prospectivity of the region for lithium and the ongoing strong market fundamentals, ungranted licenses typically have multiple applications and the auction style process which follows can take some time to be resolved. It is therefore of great advantage to NLI to already have the licenses on this new tenement package. Consequently, NLI’s team is already identifying exploration targets via soil sampling and mapping.

With regard to the Sepeda court process, the company are still awaiting a date for the hearing although continue to expect this to be in November 2017.

We reiterate our Speculative Buy recommendation and A$0.2/sh. target price.

]]> Oil price, Amerisur, Aminex, Union Jack/Egdon And finally... Mon, 06 Nov 2017 12:45:00 +0000 WTI $55.64 +$1.10, Brent $62.07 +$1.45, Diff -$6.43 +35c, NG $2.98 +5c

Oil price
Oil was up over a dollar on friday making the best part of two on the week, another 50c rise this morning is getting people worked up about new highs and even big figures. My year end target of $60 for Brent was looking pretty sorry for itself back in June but I didnt change it then and i’m not planning to now. I am on $70 for June of next year but only as a target, if the growth remains as I have always said, +1.6m b/d and the Opec/Non Opec deal is extended or even tightened that is perfectly feasible.
Check out the rig count as well, at $55 WTI one might have expected an avalanche of rigs to be taking advantage, but down 8 oil units to 729 the count is the lowest since May. I remain of the view that US shale, whilst an important number is not the elephant in the room as some portray it as being. Sure, I expect production and more forward selling but so far its not obviously having a significant effect.
Finally the rounding up of 100 or more Princes, Ministers and prominent businessmen in Saudi Arabia at the weekend should have no effect on oil policy or production but it is deemed to be further control being taken by MbS who will take over as Monarch next year.

Amerisur Resources - LON:AMER 
October production numbers from AMER and of course the vital OBA export figures all of which point to the company hitting its short term targets. Average production of 6,172 b/d with a peak of 7,398 and current of 6.023 shows that although it swings around somewhat the numbers are increasing.
The OBA export numbers were better still, an average of 6,102 was good but better was a peak of 8,001 b/d which shows that when production is flowing well the pipeline and export facilities can cope. The 3rd export pump at the Platanillo export facility is now fully installed and completing testing with the aim of being in service later this month. The company remains on course to hit its target of 7/-b/d + by the end of the year and whilst there are always times when production and transportation can be hit for all the usual reasons in the area it seems that with CPO-5 on L/T test production is, at the moment, reasonably stable and rising.

Aminex - LON:AEX
AEX is down this morning after an announcement that has spooked the market regarding gas production from Kiliwani North-1. Following a  power outage a few days ago in Dar es Salaam gas demand fell and has reduced flow rates to around 1 mcf/d and their is some technical validity to the thought that the well is draining a compartment within the Greater Kiliwani North structure and ‘exhibiting slow recharge’.
Solutions include installation of compression facilities, which should boost production at minimal cost, in the meantime the current, lower production should have beneficial effects on maximising long term recovery and better reservoir management.
AEX has no debt, cash in the bank and whilst problems at Kiliwani North are irritating, investors should be concentrating more on the Ruvuma PSA where a 25 year development licence has been applied for. It should be noted that the announcement from Solo, who are not the operator, is probably slightly more accurate and that a 20% fall in the AEX share price is way overdone and an opportunity to buy some cheap stock…

Union Jack - LON:UJO /Egdon Resources - LON:EDR 
A modest deal onshore UK today but for Union Jack it builds their position and adds near term cash generation. They are buying 20% of the Fiskerton Airfield oilfield in Lincolnshire from Egdon Resources for £137,000 plus UJ will fund re-processing of the 3D seismic dataset at a cost of around £35,000.

And finally…
With the Noisy Neighbours beating the Gooners 3-1 yesterday despite Wenger’s feeling of huge grievance about the fall of Sterling and Chelski beating the Red Devils 1-0 there is quite some gap opening up at the top and they are playing terrifyingly good football. Elsewhere Spurs kept in touch by beating the Eagles 1-0 and with the HubCap Stealers beating the Hammers 1-4 they put the final nails in Mr Bilic’s coffin he was sacked as the spectators sang ‘in the morning’. With the Terriers beating the Baggies, there might be a vacancy there although the thought of Tony Pulis turning up on the doorstep might give Hammers and Toffees fans nightmares if the thought of David Moyes was not enough…
For Australians the Melbourne Cup is the horserace that stops a nation and so at 4am tomorrow all will come to a standstill.

]]> VSA Capital Market Movers - Egdon Resources Mon, 06 Nov 2017 08:27:00 +0000 Egdon Resources (LON:EDR) has announced that it has sold a 20% interest in the recently acquired Fiskerton Airfield, for a cash consideration of £137k, to Union Jack Oil (UJO LN). In addition, UJO will fully fund the re-processing of 3D seismic data at a gross cost of £35k. The effective date of the transaction is November 3 2017 and completion of the acquisition is subject to approval of the OGA.

Given EDR acquired the asset for US$750k, the sale of the 20% for an implied valuation of US$1.09m, the sale represents an early and profitable realisation of value for EDR whilst minimising the cost of upside evaluation. This will be used to determine the benefit of infill drilling which is being considered beyond the current planned workovers.

We reiterate our Buy recommendation and 35.5p target price.

]]> Oil price, President Energy, Ascent Resources, Far Limited, And finally... Fri, 03 Nov 2017 11:40:00 +0000 WTI $54.54 +24c, Brent $60.62 +13c, Diff -$6.08 -11c, NG $2.93 +4c

Oil price
A sluggish start yesterday for the oil price, the inventory stats were fine but the API had taken the kudos the day before so it was a bit like after the Lord Mayor’s Show. Having said that both the KSA and Russia talked the talk in comments and interviews and there is clearly serious intent to maintain $60. With a couple of noticeable refinery outages in the US and the UK it was as much a product price led rally later in the day.

Yesterday evening was crucial in the finances for Venezuela as the $1.1bn payment by PDVSA was due as mentioned here a few days ago. In a televised broadcast the President said that this one would be paid today but that’s all folks. Now the country is going into voluntary debt restructuring which could mean anything….

President Energy - LON:PPC 

Yet more information from PPC as  the company announce a significant upgrade to Prospective Resources in their Puesto Guardian concession and the Matorras and Ocultar licences in the Salta Province of Argentina, all 100% owned and operated by the company.  The potential scope of these upgrades has led the company to start a farm-out process for the Matorras and Ocultar licences as this will ‘fast track’ exploring the major potential of these prospects and increase shareholder value.

The findings mean that Aggregate Paleozoic gas/condensate prospects net to PPC are mean unrisked prospective resources (MUPR) of over 7 TCF of gas with an upside of 20 TCF and 185 MMbbls of condensate. In addition there are new unreported Cretaceous oil prospects of over 40 MMbbls MUPR identified in the area.
Chairman Peter Levine said in the announcement that “President, as a profitable producing company, remains clearly focused on positive cash flow, profit margins and materially expanding our production base both organically and by way of acquisition”. With Argentina becoming increasingly popular for inward investment at both major company and mid-cap level there is little doubt that the portfolio assembled by President has significant value and accordingly the shares are still very much undervalued.

Ascent Resources - LON:AST
Ascent has announced this morning that export production from the Petisovci Field in Slovenia to INA in Croatia has commenced. With the addition of the Pg-11A well today it will be fully up and running. Next up the company are planning re-entry and completion of existing wells to increase production. The situation is made better by the fact that INA will take as much gas as AST can provide thus nullifying the need for finding new customers.

They company raised £1m last week on primary bid as the INA contract took longer to complete than they had expected but with revenue now coming through they are suitably financed. Should the IPPC decision go their way there is further good news around the corner. I met with Colin Hutchinson earlier in the week and am convinced that he is handling all the processes extremely well and that AST should move a good deal higher, part of that process has started this morning.


I met with Cath Norman of Far when I was in Cape Town last week and I can confidently say that things are going very well in all their areas of operation. The situation in Senegal has been discussed many times and whilst arbitration is under way there is little more one can add. All I would say is that clearly the market hasn’t appreciated the value in the company that it has, for example, attributed to Cairn and that this will come out at an appropriate event in the future. Whether this is the arbitration or something different I can’t say but surely it will.
For what it’s worth I am as convinced as ever, if not more so that Cairn is seriously considering selling all or part of its 40% stake in the project, indeed this may already be underway. The reason I say this is that whilst Cairn is still the operator it has in its gift, or whoever buys that stake, the significant possibility of passing on that to any potential buyer. Should that buyer be a super major then, perhaps with the Far 15% stake added to it would  give a majority in JV decisions, if I was advising them, with so much interest in the region I would consider it to be a value that would go once the operatorship transferred to woodside as currently envisaged. To give an idea of potential upside for Far, I understand that Cairn would only sell if the offer was just too good to be unturndownable…
Away from Senegal it is worth remembering that Far has an 80% stake in a potentially huge prospect in The Gambia which will be drill ready in 2018 and where Far has done a lot of the leg work already. Here where the data room is open the company can offer farminees the opportunity to get in at the ground floor on what might be another Senegal, who knows, may be even bigger. With the 80% stake Far can tempt majors with a big stake and of course the operatorship in a country where the new Government are very much open for business.
Shareholders in Far have been patient way beyond most would expect and you couldn’t blame them for abandoning ship things have taken so long. However I would seriously advise holding on as I think that the next few months will vindicate that patience and reward by what should still be a multiple and that is just in Senegal, in the Gambia they may yet have another….

And finally…
The Toffees fell out of Europe last night but to be honest they havent seemed committed to the Boropa Cup from the outset. Whereas the Gooners have and are now in the last 32 and look as good as any other side in the competition.

This weekend sees two standout ties both on Sunday, the Noisy Neighbours take on the Gooners and Chelski will welcome back Jose with the Red Devils. Spurs host the Eagles, also on Sunday whilst tomorrow sees the Hammers hosting the HubCap Stealers, high flying Burnley going to the Saints while the Cherries have a long trip to the Magpies.
There is some fantastic jump racing as well this weekend, the Charlie Hall Stakes at Wetherby sees the return of a number of favourites including Cue Card and Coneygree. There is also a good card at Ascot with a few old favourites making seasonal reappearances.
Finally the Ba Baas take on the All Blacks which should see many points on the board.

]]> Oil price, Independent Oil & Gas, Columbus Energy Resources And finally... Thu, 02 Nov 2017 10:04:00 +0000 WTI $54.30 -8c, Brent $60.49 -45c, Diff -$6.19 -37c, NG $2.90 n/c
Oil price
Oil consolidated yesterday, the EIA stats were good but the headline crude draw of 2.4m barrels was lower than the API numbers had indicated, having said that all the other numbers were positive. Total commercial stocks drew 5.8m barrels as exports rose and imports fell, in products, gasoline drew 4m barrels which is impressive and distillates drew 320/- barrels. Some profit taking was inevitable but core strength is still visible.

Independent Oil & Gas - LON:IOG
IOG has announced this morning that they have had ‘significant prospective resources confirmed’ at their Harvey licence following a CPR by ERCE. As a result of this they have committed to an appraisal well on the licence ‘within two years’ although I suspect that they might want to go ahead sooner if it proved possible.  The CPR gives IOG  gross, mid-case unrisked prospective gas resources of 114 BCF, in line with management expectations. Of this 90 BCF are within the area 100% owned by IOG and I would suspect that owing to the economics of the process they would be best placed to secure the acreage they don’t already own.

Strategically this is an almost perfect fit for IOG, any gas found, and the COS is around 50%, would be exported through the Thames pipeline along with gas from the  Blythe and Vulcan hubs which it lies between. As a result this is potentially very value accretive, although there is no certainty of success should there be a discovery it might be nearer the ERCE upper end of resources which are 286 BCF.

Columbus Energy Resources - LON:CERP

Columbus has announced that its Open Offer was 3.2x oversubscribed indicating plenty of shareholder support for what the new management is up to. Clearly this raise was primarily to allow Schroders to make their investment but with a raise of £4.1m the company is heading in the right direction. The management have very high hurdles to achieve but are clearly well supported and have a long way to go.
And finally…

A great night last night for English clubs in Europe as Spurs beat Real Madrid and the Noisy Neighbours and the HubCap Stealers won as well. Tonight the Gooners host Red Star Belgrade and the Toffees are taking a depleted side to Lyon. How the almost mighty have fallen…
My US commentator will post tomorrow but I can’t help mentioning the fantastic win by the Houston Astros against the mighty Dodgers in the World Series. 3-3 and in LA it was all to play for but the Astros fully earned their first ever title, oh to be in Houston right now!!

]]> VSA Capital Market Movers - Independent Oil & Gas Thu, 02 Nov 2017 08:29:00 +0000 Independent Oil & Gas (LON:IOG)
Independent Oil & Gas has announced a revised CPR on the Harvey license. The Harvey license lies between the Blythe and Vulcan Satellite Hubs; it is intended, pending appraisal, that gas from the Harvey field is exported via the Thames Pipeline as with the other sites.

The CPR demonstrates unrisked prospective gas resources for Harvey of 114 BCF in line with management estimates. The range for resources is 45-286BCF and most likely 90BCF on the license owned 100% by IOG. IOG have committed to drilling an appraisal well which will test the up dip potential of the structure and this will be carried out by December 20th 2019, subject to acceptance and a license extension by OGA. Given the proximity of the field to the Thames pipeline we believe that this will have a significant positive impact on the economics of Harvey and further strengthens the rationale of the hub strategy particularly given that even at the most likely level of gas resources, this would be IOG’s largest field.

We reiterate our Buy recommendation.

]]> Oil price, Echo Energy, President Energy, Reabold Resources And finally... Wed, 01 Nov 2017 15:04:00 +0000 WTI $54.38 +23c, Brent $60.94 +35c, Diff -$6.56 +12c, NG $2.90 -7c

Oil price
Onwards and upwards as yesterdays news was all pretty positive both actual and technical. The Reuters October Opec production report showed exports of 32.78m b/d, 80/- b/d down on September and compliance is around 102% if not lower. The API inventory stats which came out after the close were also way better than expected, crude stocks drew by 5.09m barrels against the whisper of 1.8m and in products gasoline drawing a whopping 7.7m barrels and distillates 3.11m also much bigger than forecast. If the EIA numbers today in any way confirm these stats then the recent rally will likely continue.
Finally, on the technical front, as I mentioned yesterday chartists are getting very excited by this latest uptick in the oil price, from its low of $44.43 on 22nd of June to the new January contract trading at $61.50 this morning the crude chart is behaving very well indeed, closing around or above these levels give very strong signals on the chart.

Echo Energy - LON:ECHO 
The long awaited landmark deal from Echo has been announced, they are entering Argentina with an onshore farm-in agreement covering four assets with CGC, a private subsidiary of the Corporatión América International. This well respected local partner will provide just what Echo needs as it aims to become a leading LATAM gas explorer. Under the agreement Echo will gain a 50% interest in each of the Fracción C (FC), Fracción D (FD) the Laguna de los Capones (LC) and Tapi Aike (TA) licences. All these are in the prolific Austral Basin of the Santa Cruz Province and cover 11,153²km in total.
Consideration for this acquisition is spread across the assets depending on work programmes etc. At TA there is no upfront cash payment, Echo will carry CGC for 15% of the 3 year work programme (4 if tight gas) which will include reprocessing 2D and 3D seismic, the acquisition of 1,200²km 3D and 4 exploration wells, Echo’s estimated carry here is $9m. At FC, FD and LC there is a $2.5m signing on fee and Echo will pay 100% of the initial 18 month work programme for which their cost of carry is estimated to be $9-12m for CGC’s 50% interest. This will include reprocessing existing 3D seismic on the LC licence, acquisition of 500²km of 3D seismic on FCas well as 4 exploration wells completed as producers. At FD there will be 3 workover wells and if appropriate 1 new well as well as acquisition of 230²km of 3D seismic. After this there will be a deferred cash payment of $2.5m and a series of options to progress to second terms on the licences.
For Echo all this adds up to a very meaningful package of assets that give gas production at FC and FD of 11.4 MMscfe/d with the potential to rise to 80MMscfe/d which at ‘strong local gas prices’ will be a useful start. Having said that it is the appraisal and substantial exploration upside that will be the making of this deal for Echo, indeed it might rival or even beat the TCF opportunities at Sound Energy as a comparison. With a massive work programme, investors will see a well to be spudded in Q1 2018, followed by a lengthy period of operational activity. It looks as if the James Parsons/Fiona MacAulay team has got off to a flying start, after all it takes two to tango…

My comments below on Argentina should ensure that investors will be happy with the country risk and see this deal as the company says, the ‘backbone of our gas business’, it certainly looks to be a very impressive start.

President Energy
I had planned to write a couple of things about President especially having seen Peter Levine’s presentation at the 121 conference on Monday. A number of commentators, particularly those on the Private Equity panel were impressed by the way the company is being set up to make decent margins and proper profits. I would add that given the company’s exposure to Argentina it is worth noting the article in yesterday’s FT regarding the opening up of banking within the country under President Macri. That neatly tailed in with news that Reuters have upgraded the country from B to B+ and a ‘stable outlook’ with strong consumer and business confidence, whilst there is clearly some way to go it makes for a pleasing backdrop to the investments that President and others are making in country.
If you combine this with the strong recent oil price and confidence placed in the company by its shareholders in the recent placing, it is most surprising that the shares are trading at an albeit modest, discount to the 10p in the €5m Open Offer currently still available to holders. With my target for this company significantly higher and with obviously increased interest in the region, the market price and that of the offer are more than just tempting, rather unduly attractive.

Reabold ResourcesLON:PPC 
A very quick word on Reabold Resources, a company I wrote about recently as I have a feeling that it may well become a magnet for smart small company investors. Today they announce that they are investing £1.5m for a 34.5% holding in Corallian Energy, a private company with a number of licences including the Colter appraisal project. Colter is offshore and adjacent to Wytch Farm and appears to be pretty low risk, with an appraisal well due to be spudded 1H 2018 this might just be a small pot of gold.
I am led to believe that this, although only RBD’s first deal, is more than likely to be the first of many for the pair of former fund managers in the sector and the company should be very much on investors radar screens…

And finally…
There will be November baseball this year after the Dodgers beat the Astros to level the World Series at 3-3 and take it to game 7. The momentum is now back with the Dodgers but if the rest of the series is anything to go by, this all or nothing decider should be a classic. Yu Darvish pitches for LA and he takes on Lance McCullers Jr for Houston, although you can expect to see a couple of big names coming out of the bullpen. Whatever happens, it has been an amazing series and credit goes to both teams for a great show!
Less exciting was last night’s footy, Benfica lost at the Theatre of Dreams with comedy goalkeeping continuing from the home leg, Chelski lost 3-0 to Roma but should still qualify but Celtic will not after losing at home to Bayern. Having said that it is the Europa League that excites Brendan Rodgers…
Tonight the HubCap Stealers have another chance at the coconut shy with opponents NK Maribor whilst the Noisy Neighbours are in Napoli and Spurs have a chance to prove the last game wasnt a fluke by entertaining Real Madrid at Wembley.

]]> Oil price, Echo Energy, Range Resources, Pantheon, And finally... Tue, 31 Oct 2017 13:10:00 +0000 WTI $54.15 +25c, Brent $60.90 +46c, Diff -$6.75 +21c, NG $2.97 +3c

Oil price
December Brent hit $61 yesterday before expiring at $60.90, expect to see some weakness in the January contract but closing much above $60 would be an impressive achievement. Iraq has managed to get production from the South up a fair bit to make up for problems in the North and that should all be settling down before long as another Independence battle is lost.

Echo Energy
Yesterday Echo Energy announced that it is in discussions in relation to a potential farm in by the Company into certain onshore oil and gas assets in South America. As this would, by virtue of its size be considered an RTO under the Aim rules, the shares are suspended until either an admission document and circular to shareholders is published or if the transaction is terminated. This should be encouraging for shareholders who have been waiting patiently to see what the deal might be, at least it looks like it will be ‘of size’.

Range Resources
A couple of announcements from RRL who yesterday confirmed that their Indonesian deal had completed,  RRDSL is being voted on on 30th November and the Trinity  swap is going through the appropriate approvals. They have also announced in their quarterly report today that production is up 10% at 579 b/d. Clearly with all these corporate deals going on the nature of RRL will have changed when the company’s shares are readmitted but it does look promising, more after I meet with the company shortly.

Pantheon Resources
Another infuriating report from PANR this morning with an assortment of news on the drilling front. The VOBM#4 sidetrack has started with the intention of assessing the Wilcox formation which interestingly wasn’t the initial target, expect news from that in around 30 days. The gas processing facility is now complete and will be starting up in the second week in November which should mean revenues in December.
The VOBM#2 well is still causing trouble and will produce directly into the gas facility, given the trouble that the wellbore is clearly still giving I wouldnt be holding my breath quite yet. All very much a watch this space situation and us long term believers in the project are being sorely tested…

And finally…
Way too much sport over the last few days to take in but Spurs lost at the Theatre of Dreams but wins for the Noisy Neighbours kept them in the lead and Chelski, Gooners and the HubCap Stealers all won. Burnley won last night and are 7th in the table but probably about to become managerless…
Tonight the Red Devils host Benfica, Chelsea are at Roma and Celtic host Bayern Munich.
Lewis won the F1 title in odd conditions but it’s still a win…
In a wet Malaysian MotoGP the Championship battle continued when the Ducati pairing of Lorenzo and Dovisioso overtook early leader Zarco to fight for the lead. Lorenzo, in his best race this season, had already been sent the coded instruction from his team to “Let Dovi through” when a mistake sent him wide on Lap 16 giving Dovizioso the lead . Marquez struggled to keep up with them after half distance and could only manage 4th place behind rookie Zarco in 3rd.. Dovi’s win leaves him 21 points behind Marquez and he still has a slim chance of the title at the final round in Valencia.Although Marquez only has to stay upright to win his 4th title , his hard riding means it isn’t guaranteed !
In an incredible fifth game the Astros go 3-2 up against the Dodgers and now go back to LA, more later.

]]> VSA Capital Market Movers - Independent Oil & Gas Tue, 31 Oct 2017 09:27:00 +0000 Independent Oil & Gas (LON:IOG)

Independent Oil & Gas has announced that it has submitted the Field Development Plan (FDP) for the Vulcan Satellites Hub to the UK Oil & Gas Authority (OGA). IOG recently published a CPR indicating a significant upgrade and expansion of 2P reserves on the Hub.

The project is underpinned by the acquisition of the Thames Pipeline that enables IOG to tie back the gas fields into the pipeline and save significant capital expenditure thereby enhancing the project economics as demonstrated by the recent CPR. Furthermore, IOG has reduced the upfront funding requirement via agreements with various major contractors such as Schlumberger, Heerema and ODE as part of their service contracts. These commitments from major service contractors further demonstrates confidence in the project as well as enhancing IOG’s ability to fund the development and retain its 100% ownership.

We reiterate our Buy recommendation.

]]> VSA Capital Market Movers - Egdon Resources Mon, 30 Oct 2017 08:33:00 +0000 Egdon Resources (LON:EDR)

Egdon Resources  has completed the previously announced transaction of the Fiskerton Airfield oil field in Lincolnshire (License EXL-294). The announcement of the transaction was made in July 2017 and following a cash payment of $750k EDR has obtained a 100% interest from Cirque Energy.

The acquisition is effective from Jan 1 2017 and field sales averaged 15.7bopd in H2 FY 2017, below the current run rate due to a maintenance shut-in during January 2017. Current production is between 17-19bopd from one of the two production wells and as previously indicated EDR intends to increase production to 30-40bopd  via modest capital spending.

To date around 400kbbls of oil have been produced from an estimated STOIIP of 2.2mmbbls and we believe that the addition of high quality oil production (32.5⁰ API) is an attractive addition to the portfolio.

The asset has already been incorporated into our target valuation, however, is not fully reflected shares currently. We therefore, reiterate our Buy recommendation and 35.5p target price.

EDR is due to announced full year results tomorrow, 31st October.

]]> Oil price, SDX, Tullow And finally... Fri, 27 Oct 2017 11:11:00 +0100 WTI $52.64 +46c, Brent $59.30 +86c, Diff -$6.66 +40c, NG $2.89 -3c

Oil price
With very quiet trading today crude oil is virtually unchanged after another positive week. Yesterday Brent closed within spitting distance of the much spooked $60 level although it was a 27 month high for the marker. A combination of factors is keeping oil high some more tangible than others. The EIA inventory data showed a massive 12m barrel fall in total commercial oil stocks and with products drawing more than expected they were enough to stabilise the market.
The Saudi Crown Prince, MbS to his mates, has reiterated the Kingdom’s commitment to stabilising the oil market and with the backing of Vlad post the recent Royal visit to Moscow relationships appear pretty pukka. Finally it seems that the Iraqi crisis is powering down somewhat and exports are picking up albeit slowly.
Just back from Cape Town and I will be writing up one or two other meetings in the next few days, however I thought that the mood for all sorts of projects was much more upbeat than I expected.

SDX Energy
SDX has announced that it has spudded the KSR-15 development well in the Sebou area of Morocco. This well, the second in the nine well drilling programme should be complete in 21-30 days and if successful will be connected to the local infrastructure within 30 days of the rig leaving site. The KSR-14 well is expected to be on test production within 10 days.

Tullow Oil
Tullow has announced that the Araku-1 well offshore Suriname found ‘no significant reservoir quality rocks were encountered’ but that there was evidence of gas condensate. All the usual guff about being very important data etc but whilst disappointing this was truly a wildcat in the strictest sense of the word.

And finally…
It is a big weekend coming up but I first wanted to big up the England U-17 football team who beat Brazil in the semifinals of their World Cup and now play Spain in the final tomorrow, good luck fellas.
In the Haribo Cup, the Gooners beat the Toffees and in a thriller at Wembley the Hammers came from being 2-0 down at halftime to win 2-3. The prize for that in the farcical draw yesterday was another visit to North London to play the Gooners. The rest of the draw has Bristol City getting the plum home tie against the Red Devils, the Foxes hosting the Noisy Neighbours and Chelski hosting the Cherries.
Interestingly, as so often happens that tie also happens this weekend when Chelski visit the Cherries. The standout tie is of course the visit of Harry Kane-less Spurs to the Theatre of Dreams, after losing to the Terriers last week some backsides I presume were smacked. This weekend those very Terriers travel to fortress Anfield hoping for another scalp. Elsewhere those Noisy Neighbours go to the Baggies who are building up one hell of a reputation for being boring whilst the Hammers travel to reinvigorated Eagles who picked up their first points last time out. And it’s another Riviera derby as the Seagulls  entertain the Saints whilst the Foxes host the Toffees and the Gooners entertain the Gooners.
Anthony Joshua takes on Carlos Takam in Cardiff who wasnt his original opponent but a late replacement.
Lewis can finish 5th in the Mexican GP and that will be enough for him to clinch the title but I am sure he wants to do it in style…
And it’s a great thing to say that proper jump racing is back with Cheltenham today and tomorrow.
And in the World Series after an amazing second game which was won by the Astros on away turf they go back to Houston now….

]]> Oil price, Victoria Oil & Gas, Wentworth Resources, And finally... Thu, 26 Oct 2017 07:37:00 +0100 WTI $52.47 +57c, Brent $58.33 +96c, Diff -$5.86 +39c, NG $2.97 -2c

Oil price
A quietly better day yesterday with comments from Russia who said that compliance is 102% and the Saudis who commented that they would continue to do ‘whatever it takes’ to maintain price stability keeping momentum upwards. With the Saudis continuing to cut and most others falling in line, at present there is little reason to disbelieve the positive stance.

Victoria Oil & Gas
VOG announced this morning that ‘as a result of recent market speculation regarding the company undertaking a potential fundraise’ the company, having been in advanced discussions with a number of investors, was indeed now going ahead with a proposed placing and subscription to raise $20-26m and an Open Offer to raise $3m. Since then the company has confirmed that through the ABB the company has raised gross proceeds of $23.5m at 57p.

I have yet to talk to Chairman Kevin Foo but here at Africa Oil Week CEO Ahmet Dik has been at pains to point out that production expansion in the near and longer term in Cameroon is crucial to the success of the company’s policy in Douala. Indeed, the availability of capital and the resultant cost reductions over the operational base, both at Logbaba and the potential production areas at Bomono and in the Matanda block are crucial to the the significant ongoing profitability of the company.

With the company targeting the 1,700 MW deficiency of power in Douala including significant demand from both local power generation and local industrial users, it is the right time to step up investment in all areas of the business. This means that the La-108 well which is close to testing, should be ready to go into production by the end of this year followed by drilling the La 109 well in 2018. The next obvious investment will be at Bomono and in the Matanda block where easier to drill and produce wells will be able to satisfy significant local demand. Bolstered by increased gas processing efficiency at Logbaba and extended pipelines to Bomono and the potentially exciting Eastern corridor capacity and deliverability will be company changing.
With this raise VOG has made significant inroads into its cost base and with the potential for the highly prolific Matanda block ever closer, the huge local demand will be easier to address. The company estimate that they will  deliver 100 mmcf/d by the end of 2021 with both power generation and thermal industrial clients still needing to be satisfied. I will comment further in the next few days when I have spoken to the company in more detail but this successful raise to bolster production in a market crying out for more gas seems eminently sensible. VOG still looks incredibly good value and this raise makes the economics look even better than before.

Wentworth Resources
I met with Geoff Bury, MD and CFO Lance Mierendorf of Wentworth Resources who are in Cape Town at Africa Oil week. I will write in further depth later but my increasing confidence in the company was more than justified by the discussions we had.

Recent announcements from the company have showed a significant increase in production from Mnazi Bay in Tanzania and whilst not getting carried away it does look highly promising. At present production is in the 60-70 MMscf/d range and growing and whilst annual guidance is still in the 40-50 MMscf/d range for appropriately cautious reasons one can consider this asset to be delivering with increased confidence even given production fluctuations. As with other parts of Africa there is a significant increase in demand from power producers and industrial users who are taking Wentworth’s gas. They include Dangote Cement at 7 MMscf/d and Kinyerezi 2 with its six turbines coming into commission later this year and through 2018 to 36 MMscf/d. The company are pencilling in further power plants with demand of up to 180 MMscf/d which is why there is so much excitement about the exploration upside of P50 resources of up to 1.5 TCF on the existing licence. Finally it is worth bearing in mind that fixed opex costs fall as volumes increase and of course a welcome return to getting paid for gas sales as evidenced by recent payments.

At the Tembo block in Mozambique WRL has 85% of  either 1.7 TCF of gas or a possible 219m barrels of oil or both, as significant oil shows were monitored at Tembo-1. Here WRL have opened the data room in order to farm-out some of their position and I understand that a good number of oil companies have acknowledged interest, WRL hope to have something tied up before the appraisal well currently planned for mid 2018. The well is designed, the location is selected and the environmental permits are under way, even a short list of rigs has been identified. This well could be a game changer for WRL and some very interesting names are having a nose around I understand. It seems to me that things are looking up for WRL and that it would not take much for the market to reappraise its longer term value, with more payments, increased demand and upside from both Mnazi Bay and the Tembo block. Certainly one to keep firmly on the radar screen.

And finally…
In the Haribo Cup last night holders the Red Devils saw off the Swans whilst their Noisy Neighbours only drew with Wolves but eventually won 4-1 on pens. The Gooners finally overcame the Canaries, the Cherries beat Boro 3-1 and the Foxes beat Leeds 3-1 and have today named Claude Poel as their new manager, Claude Who? Result of the night was for Bristol City who beat the Eagles 4-1 and go through to the quarter finals. Tonight its Chelski v the Toffees and Spurs v old rivals the Hammers…

]]> Oil price, Kosmos, Hunting, AOW And finally... Wed, 25 Oct 2017 08:15:00 +0100 WTI $51.90 +6c, Brent $57.37 -38c, Diff -$5.47 -44c, NG $2.99 +8c

Oil price
All a bit drifty again in oil markets as Iraqi exports through northern routes are up a bit at 288/- b/d still well short of normal. Inventories this week are expected to draw again but with little conviction I am told. Looking at the CFTC numbers for last week the bulls still have it, short positions are still falling especially in WTI where there is little conviction betting against further modest strength.

Kosmos has announced the acquisition of three new exploration licences offshore Equatorial Guinea and the purchase from Hess of a portion of the adjacent Ceiba and Okume fields. This is an exploration and production deal with Trident Energy ( Ex Perenco senior management) in a 50/50 JV which gives Kosmos low cost, high margin with ‘significant upside potential’. Some people are calling it going back home as as Triton Energy this discovery was made by original Kosmos founders which given how much they know about the asset shouldn’t be ignored.
From Africa Oil Week, Kosmos in the form of Exploration VP Tracey Henderson, made a most interesting presentation on deepwater exploration in which compared discoveries such as Liza with shale. The compelling part of the comparison was that deepwater easily competes with the best of shale which will return less than the onshore. Kosmos has an enviable record and has pinned its colours to the West african mast which is remarkably economical, no surprise then that the area is amongst the hottest of properties in world oil.

3Q trading update from Hunting this morning shows further consolidation and revenue continues to strengthen primarily driven by US onshore activity levels as one might suspect. Accordingly revenue guidance for the full year is now for around $700m nicely up on previous expectations. EBITDA remains positive, the 9 month number is $33m after a first half of $11m which means that it was a pretty good quarter, probably tilted towards the end of the period which bodes well for the final quarter.

All businesses focussed on US onshore continued to report ‘strong results’, all the usual suspects and even the electronics appears to have a more positive report. Offshore and international markets remain ‘subdued’ but ongoing cost cutting has narrowed losses here. The revenue increases come with their own baggage, in this case working cap has built up and debt is up to $15m but the company expect a year end net cash position more than offsetting the increase in debt.

Hunting is as strong as any in the UK quoted sector as it has the enviable US business to rely on, this is something I expect to continue whilst most of the rest of the UK quoteds excluding PFC are finding it hard going. Hunting shares have fallen since the peak but were an early riser and performance has been creditable against peers, something I expect to continue for the foreseeable future.

Africa Oil Week
To continue last night’s theme there is little doubt that the mood around Cape Town is significantly more upbeat than for the last two years, no great surprise really. Today’s presentations saw Ophir Energy extolling the virtues of Fortuna LNG in Equatorial Guinea and of course most presenters saying that costs were down and in most cases still falling.
Celicourt and Memery Crystal LLP combined to host a meeting of a number of oil company executives and advisors which was well attended and was noticeable that a large number of guests were not actually attending the conference… Those who were in possession of badges returned to hear Rick Parry, the US Secretary of State for Energy who didn’t tip his hat so much to Africa but reminded us all how brilliant the US oil industry is…

And finally…
Back to the Haribo Cup tonight when for some clubs the kids come out to play. The Gooners host the Canaries, Bristol City are hosting the Eagles, the Foxes entertain Leeds, Boro are at the Cherries, the Red Devils go to the Swans needing a pick-me-up and the Noisy Neighbours host the Wolves.
Tonight sees the start of the World Series in which the Houston Astros who have never won the title take on the LA Dodgers who must be warm favourites…

]]> VSA Capital Market Movers - NuLegacy Wed, 25 Oct 2017 07:30:00 +0100 NuLegacy (CVE:NUG)

NuLegacy (CVE:NUG) has announced that it has commissioned Mine Development Associates of Nevada to prepare a NI 43-101 compliant resource inventory for the Iceberg gold deposit at Red Hill. The resource inventory will be constrained to approximately 35% of the 3km strike length. This is the area in which there is sufficiently high drill density to determine a resource and an announcement is expected in Q1 2018. Holes from up to year end 2017 will be used which includes those from the current programme.

NUG’s stated aim continues to be to determine a multi-million ounce resource on the property.  However, as this resource inventory only covers a portion of the known mineralisation it will likely serve as a base case in our view. Having a defined resource will better enable NUG’s budgeting for determining the remainder of the resource.

We believe that the resource calculation will demonstrate the progress made to date and the significant oxidised mineralisation that has been discovered. From here there is attractive optionality to expand the resource either via infill drilling of the known deposits or by further exploration of the two new zones drilled for the first time in 2017. Meanwhile the prospect of discovering high grade mineralisation remains the most exciting potential catalyst for the stock.

We reiterate our Speculative Buy recommendation.

]]> Oil price, Cairn/Far, Savannah, Sundry-Premier-Genel-Eco Atlantic-And finally... Tue, 24 Oct 2017 08:13:00 +0100 WTI $51.84 +33c, Brent $57.75 +52c, Diff -$6.28 +56c, NG $2.91 +4c

Oil price
The blog comes to you this week from Africa Oil Week in Cape Town, the plan is to watch the presentations and hopefully chat with the speakers and report back what’s fit to print.
The oil price rallied a bit on Friday, it was a bit of a lacklustre week, WTI was up a measly 39c and Brent 58c although news was generally positive. Kurdistan remains a problem, oil exports through the Turkish pipeline are down to around 200/- b/d from a more usual 600/- whilst Venezuela is tottering on the brink of bankruptcy. Although it is only a $1bn repayment, PDVSA is thought to be going to miss this on Friday and that might just be enough to push the country off the tightrope. It is ironic that over in Argentina President Macri won a midterm vote deemed to be a vote of confidence on his agenda of pro-market economic reform.

Savannah Petroleum
Steve Jenkins, Chairman of LON:SAVP gave a keynote speech this afternoon which reminded the audience that the company’s acreage in Niger is looking better every time the 3D seismic is analysed. SAVP is robust at very low prices and there are three wells waiting to be drilled in the country with options to make that six wells. Those wells will be drilled as soon as the shares return from suspension. I took the chance to have a quiet chat with Mr Jenkins who was confident without giving anything away.
Thereby hangs the crucial part of the tale, the shares are suspended whilst the paperwork is being done for the potential Seven Energy acquisition,about which the company can genuinely say nothing. I don’t think that the market, and that includes myself, thought that would take quite so long but having watched this process and a couple of others it is a grinding, mind blowingly turgid process. We shall find out just as soon as it is possible but I do detect longer term optimism from the company and for that reason i’m still happy to remain positive.

Cairn Energy/Far Limited
Eric Hathon, exploration director of Cairn Energy, gave a very positive speech to the conference this morning and I was able to have a one to one meeting with him afterwards. Whilst Cairn havent changed their numbers at all, and readers will know that I think that the numbers will book a lot higher in due course, it is the language that is being spoken that to me is more positive than before. It is clear now that the appraisal process is now complete with the results from all the wells coming in way better than expected. There is no doubt whatsoever that as the partners go into the development process, all options remain on the agenda, these are what will determine the timings to first oil but it is a massively profitable, substantial and to quote Woodmack ‘a world class asset by any standards’.
The question that most would want to ask and of course I did without expecting an answer, is whether or not Cairn will sell all or part of the Senegal asset. The answer is again, what I had been expecting, the field is fully financed at current oil prices, and lower I suspect and there is no pressure whatsoever to sell up. The second part of the answer is equally predictable, ie if we were to receive a bid that was simply too good to be true, the board would have to consider it for understandable reasons of financial rectitude. It is worth noting that Cairn have a record of giving money back to shareholders so would be comfortable if that scenario played out.

All this makes the valuation of Far Limited to be not just difficult to understand but impossible to justify, whatever happens with all the possibilities open to the partners old and new, at A7c the shares are a steal, tomorrow I am interviewing Cath Norman so expect another update soon.

Premier Oil has announced that the Catcher FPSO has arrived and been hooked up, with a bit of twiddling it remains on target for first oil this year, my spies tell me that a bet on first oil on Christmas Day would be a canny one…

The presentation from Genel today was, as one might expect at an African one and Mike Adams, Head of Exploration talked about Somaliland, a difficult task given the political backdrop. Indeed whilst the geological presentation goes almost as to have to black stuff coming out of the ground already refined and virtually for free, the political unrest makes the country almost toxic in its complexity. The jury is out, there is no doubt about the size of the prize, just quite how to get one’s hands on it…
Gil Holzman, Chairman and CEO of Eco Atlantic Oil & Gas spoke about both of his exciting prospects in Namibia and in Guyana both of which came through the company’s policy of taking large stakes and de-risking by his scientific team. With Exxon finding oil every time they drill nearby Guyana does indeed look exciting whilst in Namibia the ever present Walvis Basin does have attractions. More after I have a one to one with Gil, hopefully tomorrow.

And finally…
The footy at the weekend made one believe that one was in a terrible dream especially if you support either Merseyside clubs or the red side of Manchester. As a result of that drubbing by the Gooners, Toffees manager Ronald Koeman has lost his job while for Spurs Wembley has lost its fear factor having stuffed the HubCap Stealers.
Lewis Hamilton won the US GP but with Vettel behind him in second place the fight goes on albeit getting more difficult for the Scuderi…
No full baseball report today but I have to mention that the Astros came from behind to make it through to the World Series where the Dodgers lie in wait…
At the Australian MotoGP the anticipated battle for the Championship between Marquez and Dovizioso failed before the off when a qualifying crash put Dovizioso at the rear of the grid from which he never recovered. However an 8 bike battle ensued with Aussie Jack Miller gaining a good lead despite fracturing his leg 3 weeks ago. He was eventually swallowed up by the factory bikes with the hard charging satellite bike of Zarco making a nuisance of himself and leaving tyre marks on Rossi’s leathers and Marquez’s bike in near misses ..whatever happened to Queensberry rules?. The sheer class of Marquez and the Honda eventually gave him the lead which he held until the flag from the Yamaha’s of Rossi and Vinales. Cal Crutchlow came a solid 5th and Bradley Smith and Scott Redding were 10th and 11th. This means Marquez has a 33 point lead going into Malaysia next week. Surely he won’t give it away now?

]]> VSA Capital Market Movers - Goldplat Tue, 24 Oct 2017 07:15:00 +0100 Goldplat (LON:GDP)
Goldplat (LON:GDP) has announced robust Q1 FY 2018 numbers with production up 12% YoY to 10.2koz which is on track for our full year target of 45.8koz. Gold sold increased 95% YoY to 13koz, however, this was primarily a result of timing of sales in Q1 FY 2017 as well as some delayed sales from Q4 FY 2017.

Increased production in South Africa and at Kilimapesa offset reduced production at the Ghanaian operations. In South Africa, production of 7.6koz was up 40% YoY with a strong focus on sourcing material for the more profitable CIL circuits. GDP has now built a stockpile of this material to last 12 months.

At Ghana, production of 1.2koz was down 61% YoY although gold sold was up 93% YoY to 2.6koz with sales and production continuing to be more volatile at this operation. We expect greater stability going forward, however, as a result of the efforts to expand sourcing from South America which is now delivering regular shipments of by-product material. Furthermore, negotiations, regarding an artisanal tailings clean-up programme, with the Government are ongoing. A mobile gold concentrator pilot plant has been constructed as part of this whilst the 3 tonne elution column is on track for commissioning in December 2017.

The Kilimapesa ramp up continues with production of 1.4koz, up 132% YoY. This was notwithstanding some disruption in the period due to employees taking time off to vote in the Kenyan national elections which has resulted in some ongoing general business uncertainty due to the contested result. The target production run rate for Plant 2 is now being regularly achieved and we expect operational performance to continue to improve in the coming quarters.

The results demonstrate continued robust operational performance and the company is on track to meet our estimates for further production and earnings growth in FY 2018.

We reiterate our Buy recommendation and target price of 17p.

]]> Oil price, Jersey Oil and Gas, President Energy, Wentworth Resources, BP And finally... Fri, 20 Oct 2017 11:03:00 +0100 Oil price

The market ran out of steam yesterday, there was no shortage of good news but a combination of profit taking and a lessening of geopolitical risk in Kurdistan as I reported yesterday, took the heat out of the market. That was added to by Shell lifting the Force Majeure on Bonny Light crude exports after pipeline repairs were completed.

The good news that was seemingly overlooked was also mentioned here yesterday, over at Opec, Secretary General Barkindo said that he was ‘engaging support’ to extend the existing cuts. This comes from the very top as it is sanctioned by Vlad and his new bestie Khalid al-Falih who is acting on orders from the King himself.

Jersey Oil and Gas (LON:JOG)

One of the worst kept secrets was that JOG was on the road and looking for money, mainly as it is so much of a no-brainer. With a fantastic discovery at Verbier, and operator Statoil looking to appraise the 25-130m as well as a likely exploration well on the already de-risked Cortina prospect, a raise now is perfect timing. I say that as with the inevitable drilling programme over the next few months any delay would have spooked the market, to get it out of the way is in my view very wise indeed.

At 200p the offer is in my view so much of a giveaway that I wouldnt be surprised to see an announcement very soon that it has been massively oversubscribed at this level. Also it should be borne in mind that JOG is still looking for UKCS production opportunities and strengthening the balance sheet at this time is no bad idea. Longer term this will be viewed as a chance not to have missed, I see a minimum of 5x the current share price as a rough TP.

President Energy (LON:PPC)

There is something in the water in the square mile as during his roadshow Peter Levine has run into people seemingly very keen to invest in the company and I can’t blame them. Today PPC launch a £6.1m raise at 10p and a €5m open offer, also at 10p which given my recent published views on the company’s prospects also looks very attractive.

Peter Levine’s vehicle is not adding at this stage as the panel would have required a mandatory bid for the company but his vehicle, PLLG will convert debt to a level of a 29.9% equity holding which will reduce the company’s costs and strengthen the balance sheet. The raise will give PPC further opportunities to buy more production and likely accelerate the existing work programme in Argentina. With the continent so full of opportunities and many companies looking to invest in the area, PPC has achieved a valuable early mover status and should be rewarded for it. The recent share price movement is only the start of a fully blown re-rating for the company.

Wentworth Resources (LON:WRL)

Good news from WRL this morning as it says that it is working with both the TPDC and TANESCO to maintain regular monthly payments and focusing on settling unpaid past invoices. As a result they have announced that this week TPDC has paid $1.1m and TANESCO $0.4m which is a big step in the right direction.

As for production, news from Mnazi Bay is also good with Q3 production of 60 MMscf/d which ups the years average to 45 MMscf/d. With the October number being around 64 MMscf/d the year’s guidance of 40-50 MMscf/d day looks eminently achievable. See below for Africa Oil Week details but I have an interview booked with WRL which I will report back on asap, watch this space as the company is quietly building its strong position in Tanzania.


After weeks of gossip all with credibility, BP has announced that Chairman Carl-Henric svanberg is to step down at the next AGM. Having presided over one of the worst ever periods in the company’s history will mean that his legacy will be correctly remembered with little good sentiment as Macondo and Bo Diddley’s $19m pay cheque rather blotted his copybook. The only worse thought is that the FT report this morning that ex HSBC Chairman Douglas Flint is an early candidate for the job, the words frying pan and fire come to mind…

Africa Oil Week

Provided I can work the technology, and that is no given, next week’s blogs will come from Africa Oil Week where an incredible array of speakers is lined up. I have been immensely fortunate to having been given access to a number of our quoted company executives who are attending the event and I will report back in the following few days.

And finally…

As the MotoGP Championship race hots up they head to Australia this weekend. Marquez topped early practice but it’s still wide open between Marquez and Dovisioso with Vinales ready to cash in if they should trip each other up.

And in F1 it’s time for the USGP and with a commanding lead built up only recently Lewis could win the title on Sunday evening.

In last night’s Boropa Cup the Gooners won and the Toffees lost, these two play each other at Goodison on Sunday…

In the footy tonight the Hammers host the Seagulls whilst the standout match of the weekend is on Sunday when the HubCap Stealers play Spurs at fortress Wembley… Also on Sunday is the clash mentioned above. Tomorrow sees the leaders the Noisy Neighbours host Burnley whilst the Red Devils go to the Terriers, Chelski host the Hornets whilst the Magpies host the Eagles, fresh from beating Chelski last week.

And the flat season effectively finishes tomorrow with Champions Day at Ascot, each race is first class and provides a proper finish to the season.

]]> Oil price, Amerisur, Genel, Plexus, Links And finally... Thu, 19 Oct 2017 10:45:00 +0100 Oil price

Onward and sedately upwards, the oil market takes note of the near 400/- b/d closed in from Kurdistan although not panicking as surely some agreement will be put in place. Chatter that the Opec/Non-Opec agreement might be extended through the whole of 2018 also supported prices but quite when that will actually decided is uncertain, maybe best kept for when they need a ‘good news moment’ as Alastair Campbell might have said…

Finally the EIA inventory data was also modestly supportive, crude oil drew 5.7m barrels against expectations of 3.9m but with refinery rates falling by 4.7% the product market was mixed. This is the time of year for refinery downtime for pre-winter maintenance made more complicated this year by the hurricanes.

It was 30 years ago today that the crash wiped 508 points off the Dow, the previous few days had seen carnage in London following the great storm and the financial meltdown continued that week, surely it couldn’t happen again…

Amerisur Resources (LON:AMER)

An operational update this morning from AMER where much is going on at the moment. Platanillo-25 is complete, it was drilled south-west of Pad 2N and found 10′ of U sand maybe slightly less than expected owing to shale content but a sidetrack will now aim nearer Plat-21 for imminent production. Finding 3′ of N Sand was encouraging and should bode well for the drilling of the N Sand anomaly where the target is a substantial 18.8 MMboe. Next up is the Plat-27 well, it will be drilled before the 23 well as the 25 data is assessed and will be north of Plat-22.

Finally as will always be the case here there are a number of general housekeeping items to tidy up wells and increment longer term production at Platanillo. Concluding the work at CPO-5 is almost complete and I expect the LTT to be under way by the end of this month.

All this means that most importantly the 7/- b/d target for year end production is still on track and with such a substantial drilling programme rolling out over the next 14 months there is still significant upside on offer.

Genel Energy (LON:GENL)

An update from GENL today with 3Q production at 33,810 and 9m of 36,030 with Tawke going very well especially following success at Peshkabir. Taq Taq remains a different story and despite more drilling appears to be in the doldrums. The RSA appears to be working well albeit at an early stage, for the long term it is by far the better option and backs up my more positive recent stance on the company. Financially the positive free cash flow means that debt is being reduced to $138m and cash reserves are $268m. Elsewhere the KRI gas assets are still in farm-out negotiations and the updated CPR for Miran and Bina Bawi is expected shortly.

Plexus Holdings (LON:POS)- Validation times-come on!

Plexus has sold its niche jack-up business to TechnipFMC for £15m rising to a potential £42.5m. This in one fell swoop validates the POS technology built up over so many years. The company will now be a specialist IP business and with a significant market outwith the jack-up area should still be a decent company. Over the next three years POS will be left with the earn-out, work in Russia and the CIS, all applications in such areas as production, in fact anything outside exploration which is still huge.

This deal is genuinely all about IP and how one of the leading service company giants has finally acknowledged that POS has made itself the market leader in this technology. Held back by the 2015 market shake up this looks at first glance to be a good deal for POS and of course they have a substantial collaboration agreement in areas such as new technology for decommissioning etc. Although it may not be all shareholders idea of perfection, to me it looks fair enough, at last it is not just Plexus and their clients who are saying that they are the best in class.


And finally…

The Yankees have won their three home games against the Astros to take a 3-2 lead in the ALCS. They now go back to Houston to finish the series. The Cubs managed to stay alive last night after they edged past the Dodgers to win their first game of the series and make it 3-1. One more game in Chicago before they go back to LA.

In the Champions League the Red Devils won at Benfica, Chelski got a 3-3 draw with Roma whilst Celtic lost 3-0 at Bayern Munich. For them it is to ensure they get that Boropa Cup spot by being third in the group of death.

Talking of the Boropa Cup, tonight the Gooners are at Crvena Zvezda, easy for you to say whilst the Toffees host Lyon.

]]> VSA Capital Market Movers - Egdon Resources Plc Thu, 19 Oct 2017 08:09:00 +0100 Egdon Resources (LON:EDR)#

Egdon Resources (LON:EDR) has provided an update on PEDL143, the Holmwood prospect, following a meeting of the Surrey County Council Planning and Regulatory Committee yesterday. EDR holds an 18.4% interest in the prospect.

The results of the meeting were the approval of a security fence for the drill site. However, the Committee elected to defer a decision on traffic management following requests for further information. As a result, EDR has indicated that drilling of the conventional oil exploration well is now likely to take place in H1 2018.

We reiterate our Buy recommendation and 35.5p target price.

]]> Oil price, RockRose Energy, Independent Oil & Gas And finally... Wed, 18 Oct 2017 08:40:00 +0100 Oil price

A very quiet day, the Peshmerga have retreated to the 2003 borders apparently which eased upwards pressure but after the close the API stats showed a big draw which if confirmed by the API tonight will maintain upward pressure.

RockRose Energy (LON:RRE)

RockRose has announced another deal this morning confirming my suspicions I wrote about last time. This deal is of a significantly bigger magnitude and regrettably is classed as n RTO by the panel and therefore requires suspension. On that point and before the inevitable grumbles, investors in RRE have always been aware of AA’s plans to buy a substantial portfolio of assets and this is part of the risk that goes with the territory. Having spoken to the man himself he is as confident that one can be that the shares should be restored before Christmas.

On the facts available it is clear that this is a potentially company making deal that puts RRE well ahead of its target of production, by the end of next year a conservative  8/- b/d. The assets that have been bought from Idemitsu comprise WI’s in 10 fields, employees and a London office which puts RRE into a bigger bracket, as promised at the time of the original raise. The deal is funded out of existing facilities and cash resources and I suspect a financed decommissioning package which we should discover when the readmission document and CPR are published. As a result of this it is impossible at the moment to work out a cost per barrel of the acquisition but I think it might turn out to be very attractive. More will be revealed when the aforementioned documents are published but I would guess that the irritation of suspension will be more than repaid by the reward when the quote is restored…

Independent Oil & Gas (LON:IOG)

IOG has announced a Letter of Intent with ODE for technical support om Blythe and the Vulcan satellites ahead of and post the FID. Pre-FID costs are fully deferred and pre first gas costs are 50% deferred until that point. This obviously ‘reduces funding commitments’ although that statement might read as ‘reschedules’ funding commitments as they aren’t going away altogether.  The good news is that London Oil & Gas have kept the faith in the company and are bit by bit having their patience rewarded. The outlook for IOG is beginning to look a lot better and I suspect that the inconsistencies of the past may be put behind them as it has been a long old haul as the faithful can testify.


And finally…

Back to the Champions League and it was a good night for the English clubs with wins for the Noisy Neighbours and the HubCap Stealers and a very creditable draw by Spurs at the Bernabéu.

Tonight the Red Devils travel to Benfica with all the history that fixture brings, Celtic are at Bayern Munich and Chelski host Roma.

We have had the second managerial departure of the season as Craig Shakespeare departs from the Foxes not so much the traditional bottle of whisky and a revolver more a case of is this a dagger I see before me, its handle towards my hand…..

]]> VSA Capital Market Movers - Independent Oil & Gas PLC, Sula Iron and Gold PLC, Goldplat plc Wed, 18 Oct 2017 08:35:00 +0100 Independent Oil & Gas (LON:IOG)#

Independent Oil & Gas (IOG LN) has announced that it has signed an LOI with Offshore Design Engineering for multiple contractor roles in the development of the Blythe and Vulcan Satellites project beginning with technical and operational support in preparation for the final investment decision.

ODE will provide technical and operational support both before and after the FID and will act as the operations and maintenance service provider. Pre-FID costs will be fully deferred while pre first gas costs will be 50% deferred until first gas. The Thames Pipeline will also be included in ODE’s remit along with an onshore operational base in Great Yarmouth.

The announcement demonstrates further support from external contractors underpinning confidence in the project. Furthermore, the terms of the LOI with significant deferrals reduce the upfront funding requirement strengthening IOG’s ability to advance the project as a 100% operator.

We reiterate our Buy recommendation.


Sula Iron & Gold (LON:SULA)#

Sula Iron & Gold (LON:SULA) has provided a corporate update. Structural interpretation work following the recent drilling programme and soil sampling is ongoing. The results of this analysis will aid in identifying the most appropriate next steps for development and management is of the opinion that finding a JV or farm in partner may be the most advantageous way of developing the Ferensola project.

The board have also indicated that it intends to expand SULA’s asset base and is considering opportunities in this regard.

We reiterate our Speculative Buy recommendation and 1.2p target price.


Goldplat (LON:GDP)#

We note the purchase of share’s by CEO, Gerard Kisbey Green.

We reiterate our Buy recommendation and target price of 17p.