First full week of the New Year and some interesting announcements. 88 Energy (88E) continued its usual pre-spud run, moving up to 0.55p (the placing was at 0.33p) on the back of announcements that snow road construction has commenced for Project Peregrine drilling, rig 111 commissioning is underway, spud is on track for mid to late February, drilling on neighbouring acreage by Pantheon Resources (PANR) is taking place this month, commercialisation options are being explored for gas discovered at Project Icewine and it was High Bidder on Tract 29 adjacent to its existing Yukon Leases and the Point Thomson field in the Alaska Coastal Plain Lease Sale. That’s the way to do it (Australian, Canadian and US companies tend to have the knack for promotion) and UK companies should pay attention. The faux cautious and conservative style only pays off for shareholders if results actually are achieved and that very rarely is the case.
Bahamas Petroleum Company (BPC) had a busy week. The Supreme Court of The Bahamas granted the application from environmentalists against the Government of The Bahamas to seek leave to bring judicial review proceedings in respect of various decisions taken by the Government in relation to BPC's licences in The Bahamas, but refused to grant any orders that would affect BPC's current operations, which means that the drilling of Perseverance #1 will continue. Financing remains opaque, but there’s probably enough available to get its Bahamas well drilled. Thereafter, it becomes problematic, extremely so should the drill result be negative. A huge amount of stock needs to be sold into the market here.
PetroTal (PTAL) announced that following the recommencement of operations of Petroperu's Northern Oil Pipeline, oil production at the Bretana oil field is currently at 9,500 bopd and expected to reach 10,000 bopd in the next few days. As a result of higher oil prices, the company's contingent derivative liability was reduced to $2.7 million at 31 December 2020 and at that date, PetroTal had cash resources of approximately $9.6 million, with accounts payable and accrued liabilities of approximately $44.3 million. It continues to work towards finalising a significant credit facility to support the planned capital program and a return to development drilling at the Bretana oil field. I mentioned PTAL positively a few weeks ago at 7.6p, after having been rather negative from the low 30s down. It’s now more than doubled to 16p.
Egdon Resources (EDR) announced preliminary results. Loss for the year ended 31 July 2020 was £4.75 million after write-downs, pre-licence costs and impairments, more or less the same as the company’s market capitalisation. On the bright side, field development operations are progressing well at Wressle and first oil is targeted during January 2021, which will add 150 bopd to Egdon's production in respect of its 30% interest. Union Jack Oil (UJO) and Europa Oil & Gas (EOG) have interests in Wressle of 40% and 30% respectively. On the not-so-bright side, the 3D seismic survey over the Resolution gas discovery in offshore licences P1929 and P2304 has been deferred by Shell from the current quarter to February 2022 and to to fund ongoing exploration and development projects, they’ve had to raise £1.05 million through the issue of convertible loan notes.
United Oil & Gas (UOG) announced the spudding of the ASH-3 development well in Egypt, which is expected to take up to 60 days to drill and test. Let’s see if this time it can hold over 3p. Canadian Overseas Petroleum (COPL) announced an additional £3 million placing. COPL has now paid $8 million to Atomic Oil & Gas LLC as the second payment, which will secure the purchase of 15% of Atomic's working interest in all of Atomic's leasehold interests. Petro Matad (MATD) announced a Block XX exploitation licence application update. The application is progressing with the last meeting of the Mineral Resource Professional Council taking place virtually. Baron Oil (BOIL) announced a Chuditch PSC update. There has been a significant upgrade in estimated resources and mean prospective resources net to BOIL’s interest now are 882 BCF. Igas Energy (IGAS) announced a business update. They’re excited about the various energy transition opportunities they’ve identified. SDX Energy (SDX) announced a trading and operations update. Production for the year was around 6,400 boepd, an increase of 58% from 2019. Nine further wells are to be drilled in 2021. Finally, Lekoil (LEK) eventually held its EGM. Three new directors were appointed and the chairman resigned.
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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.