Skip to main content

RKH PMO 88E RRE BPC PET PVR TRP LEK ZEN AAOG

First full week of the New Year and plenty going on.  

Rockhopper Exploration (RKH) announced Heads of Terms with Navitas to farm-in to Sea Lion.  This adds additional strength to the Sea Lion joint venture, which Rockhopper believes will increase the likelihood of a successful senior debt project financing for the Sea Lion Phase 1 development.  Key of course will be the local political situation.

Sea Lion JV partner Premier Oil (PMO) announced its trading and operations update.  2019 production was 78,400 boepd.  It's also looking forward to drilling its first well in Alaska, which it describes as "potentially transformational" for Premier, whose own interest comes via a farm out from 88 Energy (88E), which incidentally is now up 100% from when I mentioned it as a favourite towards the end of last year.  

Premier also announced proposed UK North Sea acquisitions, which will add around 23,000 boepd production with development upside. The acquired assets are forecast to generate over $1 billion of free cash flow to the end of 2023, exactly the type of acquisition that RockRose Energy (RRE) is looking for.  They announced a year end trading update.  Year end total cash was $370.7 million ($54.9 million restricted), similar to the current capitalisation.  

The market valuation of RockRose is very much a mystery.  I first bought it around 130p and a few months later received a 150p per share return of capital, leaving me in for free.  I said at the time it was financial alchemy, but so far it appears to be working.  RockRose now is nearly £20 a share and average production in 2020 is forecast to be around 21,000 boepd, a 9% increase on 2019, and they continue to look at opportunities to make acquisitions.  That's the key to the next step up here.

Bahamas Petroleum Company (BPC) announced an update regarding their mutual fund set up to allow locals to invest.  The fund has opened for receipt of initial subscriptions and the proceeds received from investors will then be utilised for the purchase of ordinary shares in Bahamas Petroleum.  It will be interesting to see how this goes and may open some new fund raising ideas for other exploration companies looking for extra finance.

Petrel Resources (PET) shocked investors, announcing that payment for the second tranche of shares has not yet been received from the Tamraz group.  The shares fell sharply, but still look fairly resilient at 7.75p, some 520% above the 1.25p price Tamraz is paying and it would be rather strange if this transaction did not complete.  I highlighted Petrel several times last year as a favourite around 1p and I suspect that most who bought at this level will be long gone now.

The arrival of Alan Linn as CEO at another Dublin company, Providence Resources (PVR), has perked the share price up considerably.  He's looking forward to working with the board to bring new investment into the Barryroe project.  Tower Resources (TRP), another looking to drill soon, also is starting to firm up.  I said a couple of times last year that this was a good buying opportunity under 0.4p.  Now 0.53p, key of course is a farm-out.

Lekoil (LEK) has been strong since it announced appraisal funding secured at the start of the year.  It followed up last week with an announcement of the commencement of site survey on OPL 310.  Currently 9.4p (up over 100% from 4.65p at the time of the 2 January announcement), Hannam & Partners have calculated a risked net asset value of 23p a share and an un-risked net asset value of 239p a share.

Meanwhile, the Zenith Energy (ZEN) and Anglo African Oil & Gas (AAOG) saga draws to a close.  Voting on the deal is Monday morning and it looks like Zenith is going to get the old Congo field.  It will be goodnight and goodbye to Anglo African though and, absent a relative miracle, I see it being sold down to virtually zero and delisting mid-year.  I've been seriously critical of this company for a considerable period of time, unfortunately most just wanted to argue with me.

Now, if you’re interested in knowing my trading ideas and want to read a more critical assessment of some of these and other companies, then subscribe to the private blog at https://oilnewslondon.com/oilman-jim  I receive a lot of enquiries from people interested in subscribing asking whether there is a minimum subscription term.  To clarify this point, there is no minimum term and you can unsubscribe at any time.  There’s also a first month’s trial subscription at 25% of the usual monthly cost, so why not give it a go.

For those who are not familiar with me, I focus exclusively on small cap oil and gas companies and I know this sector inside out.  I have been involved in the stock markets (both UK and US) since the early 1980s and understand exactly how the finance and promotion game works.  I also have many years’ operational and corporate experience in the oil business, which enables me to see very quickly whether or not these companies are telling the truth.  It's not investment advice that I offer and if you want that, you should speak with a financial advisor.  I share my take on companies and the markets and, as those who follow me know, I’m rarely wrong about these matters. 

Contact me on Twitter @Oilman_Jim

Click “SUBSCRIBE” to receive posts by email


The author holds 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.

Popular posts from this blog

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

PANR PTHRF I3E ITE SENX SEN SNUYF MATD PRTDF HE1 HLOGF 88E EEENF PRD SDX SDXEF HUR HRCXF ZPHR VNHLF BOIL IOG CHAR OIGLF ADV LBE DELT AEX AEXFF TRP RTWRF PVR PVDRF LOGP PPC PPCGF BOIL EME

Pantheon Resources (AIM PANR OTC PTHRF ) announced a management resource upgrade on its Shelf Margin Deltaic sequence encountered in the the Talitha #A well.   It estimates that the SMD-B zone has the potential to contain 2.6 billion barrels of oil in place and a P50 contingent resource (recoverable) of 404 million barrels of oil.   Analysis is not yet complete on the SMD-A and SMD-C zones, although it is anticipated that the SMD-A will experience a reduction, whereas the SMD-C is broadly in line with previous analysis.   Crucially, Pantheon confirmed that discussions have commenced with a number of groups for the purpose of seeking the farmout of a working interest percentage in one or more of its Alaskan projects, the aim being to complete a farmout or funding in the fourth quarter to provide sufficient capital for future drilling and testing.   PANR 's objective for winter 2021 / 22 is for an active work programme to test all zones of the Talitha #A well and to drill at least

UKOG MATD BLOE 88E EEENF CASP IOG ORCA RECO.V RECAF PPC EOG CHAR ADV LBE DELT AEX PRD TRP PVR LOGP BOIL EME

Challenges raising funds are now becoming apparent for lower calibre companies and managements.   UK Oil & Gas (UKOG) ’s recent open offer, aiming for £4.7 million, raised only £462,554, while Petro Matad (MATD) had to announce last week that it managed to raise only £76,000 of the $2 million hoped for.   The $9.7 million previously raised by MATD through a 3.5p placing and subscription had already come at a terrible price to shareholders, with the shares apparently “pre-sold” by insiders all the way from 8.8p down.   The price now is 2.9p. The fun and games continue at Block Energy (BLOE) , where a management previously unable to distinguish water from oil (that’s the innocent explanation) is trying to stop a shareholders’ resolution to commission an independent forensic investigation into the affairs of the company.   Among other things, the shareholders are looking for failures to disclose information to the market in a timely manner and inappropriate trading of shares by dire