Weekly oil news round up by Oilman Jim – HUR HRCXF CRS PPC PPCGF PRD LBE IOG 88E EEENF TRP RTWRF

It was an exciting week for Hurricane Energy (AIM HUR OTC HRCXF) stakeholders, culminating in the announcement that 92.34% of the votes cast at the shareholder meeting were against the resolution to approve the restructuring plan.  Next up is the court hearing on 21 June, however, the extraordinary general meeting to change the board (resolutions for which are highly likely to be successful) is not until 5 July.  Meanwhile, the current board is sticking with its plan regardless of the shareholder vote and will ask the court to approve the restructuring and “cram down” the shareholders, forcing the plan upon them despite their vote against.  It all now depends whether the shareholder group, led by Crystal Amber Fund (AIM CRS), can convince the court with an alternative plan.  More on HUR in the private blog.

President Energy (AIM PPC OTC PPCGF) announced the farm out of a 50% interest in their Pirity Concession, Paraguay, to “a substantial Northern Hemisphere state-owned energy company.”  In return, the farminee will pay 60% of the costs of an exploration well currently scheduled to commence during H1 2022 and will also pay President $4m in consideration of the company agreeing to enter into its performance obligations under the agreement, which is subject to regulatory approval and prolongation of the licence.  The exploration well will target the Delray complex of prospects, estimated by PPC to contain over 260 million barrels of oil (Pmean unrisked resources).  Costs of the well are estimated at between $10-15 million with an estimated chance of success of 30%.  More on PPC in the private blog.

Predator Oil & Gas (LSE PRD) updated regarding the drilling of the MOU-1 well.  Site construction and civil works have been completed and a further update on the mobilisation of the Star Valley Rig 101 to Guercif is expected this coming week.  Meanwhile, 11,784,845 new shares are being issued to Paul Griffiths to put him back into the position that existed had he not made the transfer of 11,784,845 of his shares in order to settle a recent placing, the company not having had the necessary headroom at the time.  These kinds of restrictions are the reason why Predator wants to move from the Official List to AIM, a retrograde step in the opinion of many shareholders.  More on PRD in the private blog.

Longboat Energy (AIM LBE) had a busy week.  The company announced a £35 million fundraising in a price range of 75p to 80p and ended up closing the funding at the bottom of the range.  The main thing of course is that it raised the money.  Longboat has now farmed in with three separate counterparties to a package of nine upcoming exploration wells with geological chances of success ranging from 15% to 55%.  The first four drills are expected in the third quarter of this year.  More on LBE in the private blog.

A major step forward last week for IOG (AIM IOG), which announced that the Blythe and Southwark gas platforms have successfully been installed at their offshore field locations, in line with the project schedule.  It’s another important milestone for IOG’s Phase 1 development and the facilities form a critical link between the co-owned and operated offshore pipeline network and IOG’s onshore Thames Reception Facilities at Bacton Terminal.  More on IOG in the private blog.

88 Energy (AIM & ASX 88E OTC EEENF) announced the acquisition of a 50% working interest from its partner in Project Peregrine, as a result of which 88 Energy now holds a 100% working interest in the project.  The consideration comprises $14 million of new 88E shares, to be issued in several tranches; a 1.5% overriding royalty interest on future production from the Project Peregrine licences; a $10m cash payment on the achievement of gross 2P reserves of 100 million barrels within 36 months; cash payments of $2.5m per 50 million barrels on the achievement of gross 2P reserves added over 100 million barrels within 36 months (capped at 5 additional cash payments); and 10% of the gross sale proceeds in respect of an assignment of greater than 49% of Project Peregrine within 24 months, excluding a bona fide farm-out.

The stated reasons why 88 Energy’s partner, Alaska Peregrine Development Company LLC, did not want to continue are that it allows 88E to pursue a continuation of the exploration program at Project Peregrine next winter, whereas APDC had indicated that it was contemplating a pause in activity to further understand the results from Merlin-1; APDC is unlikely to be able to satisfy anticipated funding requirements for operations in future seasons and do not want to hold 88 Energy back from future development of the acreage; and APDC do not have the technical acumen nor operational expertise to add value in a remote Alaskan context.  Essentially, they wanted out.  More on 88E in the private blog.

Tower Resources (AIM TRP OTC RTWRF) announced its preliminary results to 31 December 2020.  A loss of $1,360,736 was recorded for the year, but the company is confident that if the environment remains as it is currently, a combination of good planning and wider vaccination will allow it to proceed with the NJOM-3 well in 2021.  Market focus is on the Thali PSC, offshore Cameroon, however, Tower also has a prospective license in South Africa, plus a potentially interesting license in Namibia too.  More on TRP in the private blog.

In the private blog this evening, ADV IOG DELT LBE PRD LOGP CHAR (OIGLF) 88E (EEENF) AEX (AEXFF) TRP (RTWRF) PVR (PVDRF) PPC (PPCGF) and HUR (HRCXF) (but please note that commentary on all of these is not necessarily positive).  More on that at: https://www.oilnewslondon.com/oilman-jim 

Contact me on Twitter @Oilman_Jim 

Click “SUBSCRIBE” to receive these blog posts by email 

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.

Weekly oil news round up by Oilman Jim – HUR HRCXF LBE JOG JYOGF PRD IGAS IGESF PTAL TALV PTALF SAVE SVNNF PET CHAR OIGLF ADV IOG DELT 88E EEENF AEX AEXFF TRP RTWRF PVR PVDRF

The board of Hurricane Energy (AIM HUR OTC HRCXF) continues to taunt shareholders with warnings of their company’s imminent demise.  Latest was the announcement on Friday that the directors have resolved not to exercise the company’s option to extend the bareboat charter of the Aoka Mizu FPSO for a period of three years from June 2022 to June 2025.  The charter thus will expire in June 2022 and, should Hurricane be unable to agree an alternative extension for a shorter period, it may need to pursue a controlled wind-down of its business and cease operations at the Lancaster field upon the expiry of the charter in 2022, at which point the field would be decommissioned.  The share price is now 1.177p and as regular readers know I’ve been warning about HUR all the way from the low 30s down.

Longboat Energy (AIM LBE) at last announced its RTO – with three separate counterparties.  It’s acquiring a significant, near-term, low-risk exploration drilling programme on the Norwegian Continental Shelf, which is structured as three farm-in transactions.  This is being funded by a proposed £35 million equity financing, the net proceeds from which will be used to finance the consideration for the farm-ins and costs associated with the drilling programme.  Key will be the pricing of the placing.  More on LBE in the private blog.

Continuing offshore, Jersey Oil & Gas (AIM JOG OTC JYOGF) announced a Greater Buchan Area Development Project operational update.  The Concept Select Report has now been issued to the UK Oil and Gas Authority and the preferred development concept is for a fully electrified “Net-Zero” solution, estimated to emit carbon at a rate of less than 1kg of CO2 per barrel of oil equivalent produced, which Jersey says is significantly below the North Sea average of approximately 22kg of CO2/barrel of oil equivalent.  The most important point in terms of anything ever actually happening with the project is JOG’s confirmation that a farm-out process is now underway with broad interest and participation from multiple parties.

Predator Oil & Gas (LSE PRD) announced operational highlights for the MOU-1 drill and a placing to raise £1.5 million at 15p.  Proceeds raised are being assigned to evaluating and potentially acquiring rights to new business opportunities that the company has recently identified.  Meanwhile, the estimated spud date for the MOU-1 well is between 15 and 27 June 2021 and drilling is estimated to take 14 to 20 days.  More on PRD in the private blog, where I’ve been covering it every week since December 2019 from as low as 1.3p.  It got as high as 22.5p on Friday.

IGas Energy (AIM IGAS OTC IGESF) announced the grant of planning consent for its Stoke-on-Trent geothermal project.  It’s an interesting project that is expected to supply zero carbon heat to the city for many years to come.  A new industry report, on the economic and environmental importance of the UK deep geothermal resource by the ARUP Group and REA, estimates that, with immediate government support, the UK could deliver 360 geothermal projects by 2050.  IGAS could perhaps start carving a niche for itself here.

PetroTal (AIM PTAL TSX TAL.V OTC PTALF) announced 2021 first quarter financial and operating results.  Net income for the quarter was $30.9 million against a net loss of $31.4 million in the first quarter of 2020.  PetroTal now estimates it is operating materially above the original $90 million EBITDA budget for 2021 which assumed $50 / barrel Brent.  Excluding hedging and true-up revenue, it is estimated that for every $1 a barrel above $50 / barrel Brent, EBITDA increases by $2 to $2.5 million, making PTAL potentially free cash flow positive for 2021.  I mentioned PetroTal positively last November at 7.6p, after having been rather negative from the low 30s down.  It’s now 15p.

Savannah Energy (AIM SAVE OTC SVNNF) announced a proposed acquisition, reverse takeover and suspension of trading.  Savannah is in what it says are advanced exclusive discussions with ExxonMobil with respect to the proposed acquisition of its entire upstream and midstream asset portfolio in Chad and Cameroon.  The proposed acquisition would include a 40% operated interest in the Doba Oil Project, and an effective c. 40% interest in the Chad-Cameroon oil transportation pipeline (for information, in 2020 the Doba Oil Project produced an average gross 33,700 barrels of oil per day and the Chad-Cameroon pipeline transported a gross 129,200 barrels of oil per day).  The transaction would be classified as a reverse takeover, thus trading has been suspended, although there is no assurance that agreement between the parties actually will be reached.

Finally, Petrel Resources (AIM PET) announced preliminary results for the year ended 31 December 2020.  It’s the usual tale of woe from chairman, John Teeling, who now says the company’s focus in the immediate future will be Iraq.  Possibly of more potential benefit to shareholders is the statement that at the same time the company will open discussions with groups in other jurisdictions who might see Petrel as a way to monetise their oil and gas assets.  I highlighted PET as a favourite several times in 2019 around 1p and it subsequently went as high as 26.5p on such “discussions.”  It’s currently 2.6p, still up over 150%. 

In the private blog this evening, CHAR OIGLF ADV IOG DELT LBE 88E EEENF PRD AEX AEXFF TRP RTWRF PVR PVDRF (LOGP) HUR HRCXF and SAVE SVNNF (but please note that commentary on all of these is not necessarily positive).  More on that at: https://www.oilnewslondon.com/oilman-jim 

Now, for United States readers and those in the UK and elsewhere who are interested in something different, I’ve just published the US Special Trading Course version.

The OTC Market, a US equivalent of AIM, differs from the UK in a significant number of respects, but some of these differences offer very significant advantages to the investor:

  • Unlike the UK, not all stock is tradable, in fact often just a small part of the total issued share capital can be bought and sold.  Directors’ and control parties’ (affiliates’) stock is restricted and holding periods (6 months to 24 months for newly issued shares) mean that, unlike in London, they can’t just do a placing and sell the stock straight into the market.
  • Strict disclosure requirements ensure much more information is out in the open, allowing for a far better assessment of the underlying realities of the companies.
  • Stronger regulation on the OTC now prevents most of the AIM type abuses which so disadvantage private investors.  As just one example, promotional compensation needs to be disclosed (something which is strictly enforced), so you actually know what is independent commentary and what is paid for fluff.  Names of all those undertaking promotional activity for the company now also have to be disclosed, removing many of the bad actors from the arena, the likes of which we see all the time in the UK touting worthless AIM companies for payment on their podcasts and in social media.
  • Crucially, without distributions and underwriters quietly active (something else we see all the time in London) stock prices move much further and faster.

The course is in 8 parts and you can check out the first part for just $1.  Thereafter, it’s $19.50 a part each week for the next 7 parts.  You can cancel at any time. 

There is also a Bonus section sent to you free of charge at the end of the course explaining all the oil and gas public company deal types, with particular reference to which are the best ones.  For those interested in this sector, it could prove rather valuable.  

Total cost equivalent in Sterling for the course is approximately £97.  More information here: https://www.oilnewslondon.com/course

Contact me on Twitter @Oilman_Jim 

Click “SUBSCRIBE” to receive these blog posts by email 

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.

Weekly oil news round up by Oilman Jim – 88E EEENF CHAR OIGLF PRD SDX SDXEF PQE PQE.V PQEFF HUR HRCXF CRS ADV IOG DELT LBE AEX AEXFF TRP RTWRF PVR PVDRF LOGP

88 Energy (AIM & ASX 88E OTC EEENF) announced another operational update.  There are three highlights: encouraging evidence of oil in down hole samples is being investigated in the laboratory; additional fluorescence has been recorded at previously unidentified depths; and final payment of vendors in stock is being made.  Costs associated with the Merlin-1 well have now been largely finalised and 88 Energy‘s net share of well costs is estimated to be around the $9 million mark.

Helping preserve the cash balance, though, discussions with vendors of services provided to 88E during Merlin-1 operations have resulted in further willingness to accept partial payment for their invoices in 88E stock in lieu of cash and the company will now issue 345,000,000 new ordinary shares at a price of A$0.025 per share (total A$8,625,000) in order to finalise these payments.  88 Energy says this will leave it in a strong financial position ahead of next winter’s exploration program.  The second well, Harrier-1, is planned to be drilled early 2022 and is targeting gross mean prospective oil resources of 417 million barrels.  More on 88E EEENF in the private blog.

A further meaningful drill now upcoming is the Anchois Gas Development appraisal well, offshore Morocco, in respect of which 75% owner and operator, Chariot Oil & Gas (AIM CHAR OTC OIGLF) last week announced a placing, subscription and open offer to raise up to $23 million (£16.3 million) at 5.5p per share.  Chariot anticipates that drilling will commence in Q4 2021.  More on CHAR OIGLF in the private blog.

Another Morocco drill is coming up soon from Predator Oil & Gas (LSE PRD), which also announced an operational update last week.  It has now awarded the contract for the construction of the MOU-1 well pad platform and the improvement and extension of up to 5 kilometres of access roads.  Civil works are to start immediately to facilitate the commencement of drilling activities, which are expected to start during June, subject to the timing of the completion of the current SDX Energy (AIM SDX OTC SDXEF) drilling programme in the Rharb Basin.  More on PRD in the private blog.

Hurricane Energy (AIM HUR OTC HRCXF) announced its full year results for 2020.  It recorded a loss for the year of $625.3 million.  In respect of its proposed financial restructuring, the High Court in London has now given directions for the convening and conduct of a virtual meeting of the shareholders, which will be held via video conference on 11 June 2021.  The restructuring plan will require the support of 75% by value of the shareholders voting at the meeting.  

With Crystal Amber Fund (AIM CRS), who oppose the restructuring, already holding 14.7% of the equity, further votes from other shareholders representing only 10.3% are required to defeat the board.  The directors’ big problem is that if all the shareholders are going to get should the resolution go through is equity valued by the company and bondholders at less than 0.1p per share, why should the shareholders not just decide to roll the dice and take a gamble on the threat of liquidation, which many now just regard as a bluff?  More on HUR HRCXF in the private blog.

Finally, spoof of the week has to be the €96 million offer for 200 million shares of Petroteq Energy (TSX.V PQE OTC PQEFF) from Uppgård Konsult AB, a Swedish company with total assets per their last filed accounts of less than €175,000.  It is said by some that Uppgård is making the offer on behalf of an unidentified third party, but what genuine €96 million offeror would chose to retain as their intermediary what appears to be a dormant company with an address on an industrial estate in the middle of nowhere.

Uppgård says the offer is only open to German investors, which is convenient since none of them are likely to have the minimum 1,000,000 shares (€480,000 worth) necessary to accept the offer.  Plus, with the offer only being made in Germany, it’s also quite curious that it’s only published in English.  It is of course meant to attract the eye of gullible investors in the USA, UK and Canada, who pushed the Petroteq share price up over 200% following its release.

In the private blog this evening, ADV IOG DELT PRD LBE 88E EEENF CHAR OIGLF AEX AEXFF TRP RTWRF PVR PVDRF LOGP and HUR HRCXF (but please note that commentary on all of these is not necessarily positive).  More on that at https://www.oilnewslondon.com/oilman-jim 

Contact me on Twitter @Oilman_Jim 

Click “SUBSCRIBE” to receive these blog posts by email 

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.

Weekly oil news round up by Oilman Jim – CRS HUR HRCXF I3E PANR PTHRF 88E EEENF RKH RCKHF NVPT.L PMO PMOIF HBR HBRIY TRP RTWRF ADME P4JC ADV IOG DELT PRD LBE AEX AEXFF TRP RTWRF PVR PVDRF LOGP

None too impressed with a debt for equity swap which values their shares at less than 0.1p, 14.7% shareholder Crystal Amber Fund (London CRS) has filed a requisition notice to remove the Hurricane Energy (London HUR US OTC HRCXF) non-executive directors and appoint their own nominees.  It’s good news for equity holders and the share price more than doubled last week.  

Crystal Amber says there may well have been a failure by HUR’s board to act in accordance with section 172 (1) of the Companies Act 2006, which states that a director must act in a way most likely to promote the success of a company.  However, their most damning statement, worth repeating in full, is that “on 14 January 2021, Hannam & Partners published research paid for by Hurricane.  It estimated a “risked net asset value” of 10p a share, valuing the equity at £199 million.  This assumed an average price for Brent crude oil of $60 a barrel, compared to a current price of approximately $69 a barrel, an increase of 15 per cent.  It also predicted that bondholders would be repaid in full.  On 10 May 2021, an operational update was provided which stated that its Lancaster P6 well was producing 11,600 barrels per day.  In circumstances where it is now said by the Hurricane board that Hurricane has little or no chance of repaying the bonds, there may well have been a failure by the Hurricane board to update market participants with information already shared with Hurricane‘s bondholders.”

It’s behaviour we’ve seen before at companies such as i3 Energy (London I3E) and one should always remember that the types on these boards tend to put their own and their associates’ interests first.  As regular blog readers know well, fiduciary duty to shareholders isn’t a main priority of most London public company directors.

Pantheon Resources (London PANR US OTC PTHRF) announced a resource upgrade on its Basin Floor Fan Complex, which spans both the Theta West project and the Talitha Unit. Pantheon estimates 12.1 billion barrels of oil in place and 1.41 billion barrels of oil recoverable in the Basin Floor Fan Complex.  Given discoveries at Talitha #A and previously at Pipeline State #1, PANR believes these estimates could be categorized as contingent resources.  Another Alaska explorer touting huge resource numbers, 88 Energy (London & ASX 88E US OTC EEENF), announced a new presentation available at https://clients3.weblink.com.au/pdf/88E/02376906.pdf  It’s actually well worth reading.  More on 88E EEENF in the private blog.

Rockhopper Exploration (London RKH US OTC RCKHF) announced final results for the year ended 31 December 2020.  There’s a $222.6 million one-off non-cash impairment, based on a decision in line with the Sea Lion operator, to write off the historic exploration costs associated with the resources which will not be developed as part of the Sea Lion Phase 1 project.  On the brighter side, Rockhopper are targeting completion of the Navitas farm-in, plus the outcome of the Ombrina Mare arbitration, in which they’re seeking significant monetary damages, is expected in July 2021.  Year end cash was $11.7 million.

However, the warning is there for those who read further and there are a number of downside scenarios stated in the announcement, including the farm-out to Navitas Petroleum (Tel Aviv NVPT.L) not proceeding and the heads of terms lapsing, the Sea Lion project not achieving sanction (which could be due to a number of factors including funding not being achieved), or Premier Oil (London PMO US OTC PMOIF), now Harbour Energy (London HBR US OTC HBRIY), deciding to withdraw from the Sea Lion Development, which could ultimately result in relinquishment of the acreage.  In these scenarios the Sea Lion project would need to be wound down, including the decommissioning of assets in the Falklands, and Rockhopper would be liable for its share of these project wind down costs with no funding support from Premier and/or NavitasRKH has sufficient financial headroom to meet forecast cash requirements for 12 months, but there is a material uncertainty which may cast significant doubt on Rockhopper‘s ability to continue as a going concern.  

Better news from Tower Resources (London TRP US OTC RTWRF), which announced a Cameroon update.  Tower has now received formal confirmation from the Minister of Mines, Industry and Technological Development of an extension of the First Exploration Period to 11 May 2022, allowing TRP to proceed with finalising a schedule for drilling and testing the NJOM-3 well.  More on Tower Resources in the private blog.

Finishing on the comedy side, ADM Energy (London ADME Frankfurt P4JC) revealed its second fake sheik.  It turns out that “His Excellency” Mr Zubair Al Zubair is not quite as described and the title “relates to social and cultural adoption rather than it having been awarded in connection with a senior governmental, or such other, position.”  Perhaps it’s now time for some changes here.

In the private blog this evening, ADV IOG DELT PRD LBE 88E EEENF AEX AEXFF TRP RTWRF PVR PVDRF LOGP and HUR HRCXF (but please note that commentary on all of these is not necessarily positive).  Further on that at https://www.oilnewslondon.com/oilman-jim 

Contact me on Twitter @Oilman_Jim 

Click “SUBSCRIBE” to receive these blog posts by email 

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.

Weekly oil news round up by Oilman Jim – HUR HRCXF SENX SEN.WP SNUYF RBD UJO PTAL TAL.V PTALF BPC BSHPF IOG PRD DELT 88E EEENF LBE AEX AEXFF TRP RTWRF PVR PVDRF LOGP RKH RCKHF ADV CVN.AX CVONF MATD PRTDF

Hurricane Energy (London HUR US OTC HRCXF) announced an update on its proposed financial restructuring.  Subject to directions of the court, a meeting of the bondholders is to be held on 4 June 2021 to consider and, if thought fit, approve the restructuring plan.  Hurricane is warning shareholders and bondholders that in the event the restructuring plan is not approved, either by the bondholders or the court, it is likely that there would be a controlled wind-down of operations followed by an insolvent liquidation of the company.

Even if approved, in return for releasing $50 million of the principal amount outstanding under the convertibles, bondholders will receive ordinary shares comprising 95% of the fully diluted pro forma equity of the company, which values the existing equity at less than 0.1p per share.  I’ve been warning about HUR all the way from the low 30s down and all that was necessary to see what was going to happen here was to read and understand the consequences of the contents of Hurricane’s RNS announcements.  It’s now 0.7p.

Another one where people appear not to read the RNS announcements is Serinus Energy (London SENX US OTC SNUYF Warsaw SEN.WP).  I commented on the disparity of prices between the London and Warsaw exchanges previously and said in the private blog in March that I was dubious regarding Serinus since its share price appeared to have been manipulated in Warsaw to encourage buying / enable distribution in London.  Since then, the share price is down in both venues.

SENX last week announced interim results for the three months ended 31 March 2021 and reported a loss of over $1 million.  I mentioned this on Twitter last week and my statement was met with vehement denials.  It’s difficult at times to understand how people can be so ignorant and stupid, particularly when we’re talking about a simple fact stated by the company itself in an official RNS announcement.  One of the loss deniers was even describing himself as an accountant, while failing to understand the difference between the statement of cash flows and the statement of comprehensive loss.  It’s perhaps no wonder that such people lose money in these markets – as do those who listen to them.

PetroTal (London PTAL US OTC PTALF Toronto TAL.V) announced an operational and corporate update.  The 7D well has been successfully drilled and completed, flowing at an initial rate of approximately 3,700 bopd during its first 10 days of production; and has averaged approximately 4,550 bopd during the past three days, during which time Bretana oil field production has averaged approximately 11,100 bopd.  Two wells, representing 1,200 bopd, are currently shut in awaiting increased water injection pump enhancements.

PetroTal’s goal is to end 2021 at 18,000 to 19,000 bopd and, to help enable that, the 3WD water disposal well now is being drilled and completion is expected mid-June.  This will enable the disposal of an additional 50,000 barrels of water per day and accommodate the company’s expected production growth until mid-2022.  I mentioned PTAL positively last November at 7.6p, after having been rather negative from the low 30s down.  It’s now 15p.

In other news, Reabold Resources (London RBD) and Union Jack Oil (London UJO) announced that Gaffney, Cline & Associates has been appointed to prepare a competent person’s report in respect of PEDL183 following the testing of the WNB-1Z and WNA-2 wells.  It’s the big event for these two and is expected to commence this month.  Meanwhile, Bahamas Petroleum Company (London BPC US OTC BSHPF) announced an extension of the open offer timetable until 18 May 2021.  Funds are obviously not coming in too easily.  The Saffron-2 well in Trinidad and Tobago is hoped to spud on 23 May 2021.  

Finally, IOG (London IOG) announced a collaboration agreement with GeoNetZero CDT.  The key focus will be on proving which fields and aquifers across the Bacton catchment area are the most suitable carbon sinks, particularly where existing infrastructure could provide operational synergies.  Essentially, further greening of their North Sea gas project.  

In the private blog this evening, PRD DELT 88E EEENF IOG LBE AEX AEXFF TRP RTWRF PVR PVDRF LOGP RKH RCKHF ADV CVN.AX CVONF and MATD PRTDF (but please note that commentary on all of these is not necessarily positive).  Further on that at https://www.oilnewslondon.com/oilman-jim 

Contact me on Twitter @Oilman_Jim 

Click “SUBSCRIBE” to receive these blog posts by email 

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.

Weekly oil news round up by Oilman Jim – AAOG PRD SDX SDXEF AET SEY STGAF 88E EEENF IOG LBE DELT AEX AEXFF TRP RTWRF PVR PVDRF LOGP

So, at last, it’s time to say goodbye to Anglo African Oil & Gas (London AAOG), which announced its cancellation of trading on AIM.  AAOG has featured numerous times in the blog over the past few years and not in a good way.  It’s perhaps the company I’ve criticised the most and I’ve been right about it all the way down from 20p to oblivion.  What went wrong with it?  First, those with actual understanding of the project and the requisite experience all left the company over three years ago and secondly, terminally, the board was willing to enter into any arrangement necessary to obtain finance, regardless of how damaging it may have been to the shareholders’ interests.  Anglo African’s failure was inevitable and I’m sorry for all those who thought they knew best.

On to more positive matters, Predator Oil & Gas (London PRD) issued an operational update.  The MOU-1 well remains on schedule to commence drilling during June 2021, dependent upon the completion of drilling operations for three wells for SDX Energy (London SDX US OTC SDXEF), after which the rig will be mobilised to Predator’s acreage for the Guercif drilling, which is expected to take up to 20 days.  Results from MOU-1 may potentially de-risk up to 1,823 BCF of prospective high estimate gross recoverable gas resources.  Now over 15p, PRD is a company I’ve been covering each week in the private blog since December 2019 from as low as 1.3p.

Afrenta (London AET), the old Sterling Energy (London SEY US OTC STGAF), announced its launch “with a clear mandate to look at opportunities to invest in the energy transition in Africa.”  It aims to announce a transaction within the next 12 months.  Personally, though, I’m finding it hard to get as excited about this one as some others and, given the timescales, I think there could be many opportunities along the way to pick up AET at better prices for those who are interested.

Finally, 88 Energy (London 88E US OTC EEENF) announced the appointment of Ashley Gilbert to the board as managing director of 88 Energy with effect from 10 May 2021, following the resignation of David Wall.  Awaited over the next few weeks are the test results of the sidewall cores, cuttings, mud gas and fluid samples from Merlin-1.  88E is another which features regularly in the private blog, since it’s such a regular and reliable money earner for traders.  The key question here now is will the same “modus operandi” continue under Mr. Gilbert?

In the private blog this evening, IOG LBE PRD DELT 88E (EEENF) AEX (AEXFF) TRP (RTWRF) PVR (PVDRF) LOGP and AET (SEY (STGAF)) (but please note that commentary on all of these is not necessarily positive).  Further on that at https://www.oilnewslondon.com/oilman-jim 

Contact me on Twitter @Oilman_Jim 

Click “SUBSCRIBE” to receive these blog posts by email 

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.

Weekly oil news round up by Oilman Jim – HUR HRCXF 88E EEENF PANR PTHRF HE1 HLOGF UKOG UKLLF IOG PRD DELT LBE AEX AEXFF TRP RTWRF PVR PVDRF LOGP ARG AORGF

Hurricane Energy (London HUR US OTC HRCXF) announced its proposed financial restructuring.  As I said in the blog a few weeks ago when the share price was at 2.7p, the shareholders are done for.  In return for releasing $50 million of the principal amount outstanding under the convertibles, bondholders will receive ordinary shares comprising 95% of the fully diluted pro forma equity of the company.  That values the existing equity at just $2.63 million, which is £1.9 million, less than 0.1p per share.

I’ve actually been warning about Hurricane Energy all the way from the low 30s down.  It was more or less clear what was going to happen here and no special skill was required to know.  All you needed to have done was to read in full – and understand the consequences of – the contents of HUR’s RNS announcements.  For those who got hurt, perhaps to protect yourselves in future, it’s worth remembering who was touting Hurricane Energy over the past year or so and recall that their “research” in fact was entirely false.

88 Energy (London 88E US OTC EEENF) announced an operations update.  Testing has commenced on the sidewall cores, cuttings, mud gas and fluid samples from Merlin-1 and results are expected over the next two to ten weeks.  Initial mapping of additional prospective zones encountered in Merlin-1 is encouraging it says.  Results announced by Pantheon Resources (London PANR US OTC PTHRF) on acreage adjacent to 88E’s Icewine project have positive implications and 88 Energy is now re-assessing the potential across its acreage.  More on 88E in the private blog.

As you’ll notice, I’m now including the OTC trading symbols for those companies also quoted in the United States.  This is the big market, which was very much demonstrated by the recent massive trading activity in the shares of 88 Energy.  It also provides the ability to trade after the London market closes.  More and more UK quoted companies are obtaining US trading symbols now, the latest being Helium Energy (London HE1), which announced last week that its shares will cross-trade publicly on the US OTC under the ticker HLOGF.

UK Oil & Gas (London UKOG) also has a US ticker, UKLLF, but it’s “Grey Market” and there’s a warning on the OTC Markets website stating that “Broker dealers are not willing or able to publicly quote these securities because of lack of investor interest, company information availability or regulatory compliance.”  It might be something UK Oil & Gas should get sorted out.

Meanwhile, UKOG announced it has become one of the six founder members of the newly-formed Geothermal Energy Advancement Association.  UK Oil & Gas says it is actively scoping two new standalone geothermal projects in the UK, together with a hybrid geothermal, solar and battery storage project at the Horse Hill site.  It also plans to review geothermal opportunities onshore Turkey once the forthcoming Basur-3 appraisal well has been completed.  At least it’s a possible use for their non-commercial well bores.

IOG, formerly Independent Oil & Gas, (London IOG) announced its name change and, more importantly, completion of its Phase 1 platforms, Blythe and Southwark.  Installation of both platforms is scheduled to be completed before the end of Q2, in preparation for first gas in late Q3.  As readers of the private blog know, I’ve been positive about IOG for some time and from much lower levels.

In the private blog this evening, PRD, DELT, IOG, LBE, 88E (EEENF), AEX (AEXFF), TRP (RTWRF), PVR (PVDRF), LOGP, HUR (HRCXF)and ARG (AORGF) (but please note that commentary on all of these is not necessarily positive).  Further on that at https://www.oilnewslondon.com/oilman-jim 

Contact me on Twitter @Oilman_Jim 

Click “SUBSCRIBE” to receive these blog posts by email 

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.

Weekly oil news round up by Oilman Jim – PVR LOGP BPC KIST RRE UJO RBD 88E LBE IOG PRD DELT AEX TRP PANR

Dublin based Providence Resources (PVR) cleaned investors’ clocks again as their latest farm out collapsed.  Regular blog readers will know of my scepticism regarding SpotOn Energy Limited, PVR’s £1 capital counter party.  Money may have been made by some, however.  SpotOn acquired £500,000 of shares at 1.5p and the share price went as high as 8.5p on the ramp.  It would be interesting to know whether SpotOn (and others close to the company who subscribed at that level) still have them.

Barryroe really is the gift that keeps on giving, though, at least for Providence Resources (and Lansdowne Oil & Gas (LOGP)) insiders.  They’re already touting the progression of yet another “funding solution,” which they say is well advanced and expected to be concluded before the end of the third quarter, in time to progress a 2022 drilling programme.    It really always has been one for investors who can forget all about the idea of a commercially viable project and play it for what it appears to be: a stock promotion.  More on PVR (and LOGP) in the private blog.

Bahamas Petroleum Company (BPC) tries to grab investor money wherever, whenever and however it can.  Now, following their Bahamas drilling failure, it’s announced an extraordinary general meeting to approve a 1:10 share consolidation and a name change.  There’s a £6.9 million open offer and placing at 0.35p too, but the convertible loan note addiction is very much going to continue and it’s difficult to see any appeal at all with this one.   For those who have been hurt by BPC and others like it, remember that understanding the financing of these types of companies really is the key to success in this area of the stock market.  It’s actually much more important than the “fundamentals” which most investors appear to focus on and I’d suggest strongly that investors losing (or not making) money in this sector very much get focussed on that.

Kistos (KIST) announced the acquisition of Tulip Oil Netherlands B.V. for €222.75 million, partly paying for it through an equity financing of £52.5 million at 155p per share.  Trading resumed on Wednesday and the share price closed the week at 186p.  Kistos picks up 60% interests in a number of licences, which include profitable and cash generative producing assets, plus exploration and appraisal assets from which KIST says it is looking to deliver significant upside for shareholders.  As with RockRose Energy (RRE), future acquisitions will be key.

Finally, Union Jack Oil (UJO) and Reabold Resources (RBD) updated on West Newton.  Cased hole logging and vertical seismic profiling operations on the WNB-1Z well have been completed.  Well bore integrity has been confirmed and data is currently being processed.  The next phase of operations will comprise perforation and stimulation of the Kirkham Abbey formation and subsequent flow testing of the well.  Now the moment of truth awaits – is West Newton actually commercial?

In the private blog this evening, 88E, LBE, IOG, PRD, DELT, AEX, TRP, PVR, LOGP, BPC, KIST and PANR (but please note that commentary on all of these is not necessarily positive).  Further on that at https://www.oilnewslondon.com/oilman-jim 

Contact me on Twitter @Oilman_Jim 

Click “SUBSCRIBE” to receive these blog posts by email 

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.

Weekly oil news round up by Oilman Jim – 88E EEENF HUR PTAL UKOG LBE IOG PRD DELT AEX TRP PVR LOGP JOG PANR

Main excitement last week came from 88 Energy (88E), which moved up as high as 9.19 cents (6.7p equivalent) in the United States on Monday, hitting a $1 billion market cap when the UK and Australian markets were closed.  Ramping of the EEENF OTC symbol was widespread across social media and there was a multi-million dollar windfall for those who were able to sell into the US market.  Reality hit that evening, though, when the company announced operational issues had prevented hydrocarbon samples from the two most prospective zones.  The share price on Tuesday went as low as 0.875p on the news, but that was still nearly double the last 0.45p placing price.  It closed on Friday at 1.38p, over three times that price.

88E, which features regularly in the private blog, is a regular and reliable money earner for traders, simply because management actually plays the game expected by its shareholders, fulfilling a silent agreement with them and directing significant funds to professional public relations following their placings.  That’s why, notwithstanding numerous exploration failures, 88 Energy can always continue to raise cash.  It’s interesting how some company promoters understand this, while others don’t even want to try to give their shareholders an even break.

Grimmest company press release of the week has to be that from Hurricane Energy (HUR), which announced a “CPR Summary & Stakeholder Engagement Update.”  Essentially, the shareholders are done for.  The company reports that it continues to engage with an ad hoc group of its convertible noteholders over its forward work programme, strategy, financing and balance sheet recapitalisation and warns there is a risk of significant dilution to existing shareholders from a possible restructuring and/or partial equitisation of the convertible bonds and of potentially limited or no value being returned to shareholders. 

It gets no better, since if no agreement can be reached with HUR‘s stakeholders on additional development activity at Lancaster, although the field could continue to produce from the P6 well before reaching its economic limit (the timing of which would depend on oil prices, actual production levels delivered and the level of cost savings achievable), the field may then be decommissioned, with potentially limited or no value returned to shareholders.  Now 2.7p, I’ve been warning about Hurricane Energy from the low 30s down.

PetroTal (PTAL), now 17.62p, has staged a nice recovery since I mentioned it positively towards the end of last year at 7.6p.  It announced a Q1 operations update last week, reporting the commencement of its 2021 drilling program.  PetroTal has spudded the first well of the year (7D), with expected completion the first week of May, and has already successfully completed the workover of well 4H on time and under budget.  Following completion of the 7D well, the team will drill the second water disposal well, adding 50,000 barrels per day of water disposal capacity, and following completion of that, they will drill four development horizontal oil wells in H2 2021.  

PTAL achieved Q1 2021 exit production of 8,275 barrels of oil per day with the quarter’s production averaging approximately 7,300 barrels of oil per day.  Total cash liquidity was approximately $76 million at quarter end, plus future Petroperu true-up payments of approximately $36 million to PetroTal are expected, significantly enhancing the 2021 cash flow profile compared to budget.  After a rather rocky time, PTAL now appears to be back on track. 

UK Oil & Gas (UKOG) announced that the Turkish Ministry of Energy and Natural Resources has granted UKOG Turkey and its 50% partner, Aladdin Middle East, formal consent to drill the forthcoming Basur-3 appraisal well, located in the Resan licence, which contains what UKOG states is the “potentially significant” Basur-Resan oil discovery.  UK Oil & Gas is delighted with the speedy grant  of drilling consent, which it says illustrates how oil and gas projects can be pushed ahead with more certainty in Turkey than in the UK.

Drilling pad and access road construction works continue to move ahead at good pace, with completion expected by end May, as previously announced.  The Basur-3 drill is the first step towards establishing the commerciality of the Basur-Resan Mardin oil pool, which UKOG claims contains “potentially transformational discovered recoverable oil resources.”  All that’s really certain here is a large placing.

In the private blog this evening, 88E, LBE, IOG, PRD, DELT, AEX, TRP, PVR, LOGP, HUR, PTAL, JOG, UKOG and PANR (but please note that commentary on all of these is not necessarily positive).  Further on that at https://www.oilnewslondon.com/oilman-jim 

Contact me on Twitter @Oilman_Jim 

Click “SUBSCRIBE” to receive these blog posts by email 

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.

Weekly oil news round up by Oilman Jim – COPL IOG JOG PRD TLOU AST MSMN SDX FOG BPC SQZ ZEN SCIR SLE ZPHR ECO UJO

Canadian Overseas Petroleum (COPL) announced completion of its Atomic acquisition.  Now suspended from trading, the company has made an application to cancel the listing of the shares from the Official List of the Main Market of the London Stock Exchange, although the shares will remain listed on the Canadian Stock Exchange.  COPL then proposes to make a new application in respect of the enlarged group for admission to the Official List of the London Stock Exchange by way of a Standard Listing.  Although the deal superficially looks good, it appears the shares are going to be suspended from trading in London for quite a while.

Independent Oil & Gas (IOG) announced a Goddard and Abbeydale area technical update, plus final results for the year ended 31 December 2020.  Extensive seismic reprocessing work over the past year has identified additional resources and opportunities on both P2438 (Goddard and Southsea) and P2442 (Thornbridge, Kelham and Abbeydale) and the new data shows enhanced potential for both licences to host production hubs with step-out exploration and appraisal upside.  Meanwhile, Independent continues on the path to Phase 1 first gas in Q3 this year.  More on IOG in the private blog.

Jersey Oil & Gas (JOG) announced a placing and subscription.  £15 million was raised before expenses at an issue price of 165p.  JOG says it can now continue to develop its Greater Buchan Area project at pace and progress its recently launched farm-out process.  The numbers appear strong: 172 MMboe of 2C contingent resources are estimated, with significant exploration upside potential, and JOG aims to deliver initial production of up to 40,000 bopd.  Let’s see if they can find someone interested.  Development costs are said to be £1 billion.

Predator Oil & Gas (PRD) announced a business development update covering Guercif development and operating costs for a pilot compressed natural gas project in Morocco in accordance with the company’s strategy to fast-track monetisation of an initial potential gas discovery at MOU-1.  Also addressed in the update is its floating storage / regasification unit and LNG project offshore Ireland.  Now over 13p, PRD is a company I’ve been covering each week in the private blog since December 2019 from as low as 1.3p.

Tlou Energy (TLOU) announced a £2.625 million placing at 3.5p.  Funds raised will go towards development of the Lesedi project including construction of transmission lines to connect the Lesedi power project to the existing Botswana electricity grid.  The transmission line is a key piece of infrastructure required to enable TLOU to become a power producer and is expected to considerably reduce future funding risk for the company.  Next up is project finance.

In other news, Ascent Resources (AST) announced an update after market close on Friday regarding its Slovenian direct settlement discussions.  The Slovenia government is not prepared to pay Ascent anything at all, so look out for a big fall in the AST share price on Monday.  Mosman Oil & Gas (MSMN) announced a £1.5 million placing and a Falcon update.  The placing was at 0.15p and the Falcon well has watered out.  SDX Energy (SDX) announced financial and operating results for the twelve months ended 31 December 2020.  The result was a $2,058,000 loss.  

Falcon Oil & Gas (FOG) announced its planned 2021 work programme in the Beetaloo sub-basin.  It includes resuming clean-up operations of Kyalla 117 and commencing an extended production test, plus drilling the Velkerri 76 S2-1 vertical well.  Bahamas Petroleum Company (BPC) announced a Trinidad and Tobago and Suriname update.  Main event is the upcoming drilling of the Saffron #2 appraisal well, which BPC anticipates beginning on 17 May 2021.  Serica Energy (SQZ) announced the Columbus development well spud.  The well is expected to take around 70 days and production is expected to commence in early Q4 this year, with average gross production forecast to be around 7,000 boe/d.  

Zenith Energy (ZEN) announced the extension of the SPA for the acquisition of the Sidi El Kilani Concession from CNPC.  Tunisian government approval has not yet been received.  Scirocco Energy (SCIR) announced the disposal of its interest in the Ausable Reef assets and a Helium One update.  Nothing was received for the Ausable Reef interest; Helium One seismic acquisition has commenced.  San Leon Energy (SLE) announced an operational update.  Quite a lot in it if anyone’s interested.  

Zephyr Energy (ZPHR) announced board approval to proceed with the State 16-2 lateral.  It’s in discussions with potential industry and financial partners regarding funding.  Eco (Atlantic) Oil & Gas (ECO) announced renewal of the Orinduik petroleum agreement.  That’s now extended through to 13 January 2023.  Finally, Union Jack Oil (UJO) announced the purchase of a royalty interest.  A relatively tiny investment has resulted in a lengthy press release and presentation, and a lot of well known oil field names to drop.

More in the private blog, including my actual trading ideas.  Further on that at https://www.oilnewslondon.com/oilman-jim 

Contact me on Twitter @Oilman_Jim 

Click “SUBSCRIBE” to receive these blog posts by email 

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.