Quite a busy week for news. Petrel Resources (PET) announced preliminary results for the year ended 31 December 2019. The Chairman’s statement is a grand read and John Teeling just tells it all frankly as it is. This was a blog favourite last year around 1p and is now nearly 4p, having been many times higher. It could move strongly upwards again with positive Iraq news.
PetroTal (PTAL) announced 2019 year-end financial and operating results, reporting a “difficult trading environment” plus a placing to raise £14 million, which will allow them to continue the development of the Bretana oil field, but at a slower pace. I’ve been warning about this one in the blog all the way down from the 30s. It’s now just over 10p.
88 Energy (88E) declared its XCD Energy takeover offer to be unconditional. This was another blog favourite last year around 0.7p, which ran up over 100% before the drill. But, unless you’re into gambling, remember never to hold for the results of these.
President Energy (PPC) announced a drilling and work over plan update. This is one that was pumped by paid commentators up to 2.5p, before it announced the inevitable placing. It’s now 1.75p. Another one that I warned about in the blog – several times.
Predator Oil & Gas (PRD) updated regarding its new Irish venture. “Estimated project revenues are consistent with those quoted for the Barrow-in-Furness FSRU Project of £80 to £100 million” it says. PRD is moving up strongly now in anticipation of its forthcoming Morocco drill.
Union Jack Oil (UJO) and Reabold Resources (RBD) were trying to make the case that oil and gas production at West Newton will be “green.” I’m not sure how many people will be convinced of this. More important for investors I think will be the announcement of dates for the drill. RBD also announced the commencement of well test operations in Romania. Whether this gas will ever actually will go into commercial production is another matter entirely though.
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Back to the week’s news, there were certainly some grim goings on at the bottom end of the market. TomCo (TOM) announced a placing and a commercial agreement. Those in the placing started forward selling, then another company involved, Quadrise Fuels International (QFI), denied the accuracy of TomCo’s RNS and trading in TOM shares was suspended. It was reinstated two days later with the placing terminated, leaving the forward sellers short and the share price jumped over 250%. The forward sellers thought they were part of the inner circle; in fact, they were just the marks and John Geoffrey Bolitho sold his entire 5.58% stake to them, plus no doubt others buying in on a ramp based purely upon other people being short. I guess they also want to try to clear the warrants too.
You can perhaps see why I think these companies and markets have got zero to do with investing.
In the same peer group, Zenith Energy (ZEN), Block Energy (BLOE) Attis Oil & Gas (AOGL), ADM Energy (ADME) and Nostra Terra Oil & Gas (NTOG) all issued announcements hypothesising about future events, but none of them have any real record of actually delivering. Matt Lofgran, CEO of NTOG, complained about my statements in the blog regarding Nostra Terra last weekend, but there’s no apology, because to say they raised millions from investors with no return to shareholders other than an ever declining share price is absolutely correct. Just take a look at the RNS announcements and the chart. Instead of a few barrels of oil every so often here and there, Mr. Lofgran needs an exciting new deal with big numbers to promote if he ever wants to achieve anything.
On to slightly better companies, Petro Matad (MATD) announced final results. I’ll say it now, a placing is absolutely inevitable here. Chariot Oil & Gas (CHAR) announced final results and was quite frank: exploration in frontier regions has fallen out of favour and there is a need for nearby / adjacent discoveries to unlock basin potential. Focus now is going onto its gas development project in Morocco and at a £7 million market cap (with more than that in cash at the year end) it doesn’t look too bad a bet.
Columbus Energy Resources (CERP) announced the issuance of their so called “Lind Facility” shares. Like Bahamas Petroleum Company (BPC), with whom they are merging, CERP also is dependent on convertible loan note financing. It does not augur well. Meanwhile, Touchstone Exploration (TXP) announced final production test results from the Cascadura-1ST1. They say it is ”reasonable to design for an initial gross production rate of between 7,750 and 9,700 boe/d.” Trinity Exploration & Production (TRIN) announced its AGM statement. Production levels are at a five year high, with a year to date average of 3,269 bopd, and peak production from the new Echo platform is expected to be in the order of 3,250 to 3,900 bopd net to Trinity’s interest.
Tlou Energy (TLOU) announced an entitlement offer to raise up to £1.65 million and further announced the receipt of an Electricity Generation License from the Botswana Energy Regulatory Authority. Canadian Overseas Petroleum (COPL) announced a loan agreement for £600,000 and termination of the equity sharing agreement. I said on Monday it was a step in the right direction, which looks like the case since the share price more than doubled on the week.
My new book “UNDERSTANDING THE LONDON SPECULATIVE MARKETS and THE SECRETS OF HOW TO PROFIT FROM THEM” explains it all. I hope you take the opportunity to read it.
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The author may hold one or more investments in one or more of the companies mentioned so this post cannot be viewed as independent research. This post does not constitute investment advice or a recommendation to buy or sell and may be incorrect or outdated.