WTI (Dec) $ 75.74 +41c, Brent (Jan) $80.01 +47c, Diff -$4.27 +6c.
USNG (Dec) $3.04 -7c, UKNG (Dec) 122.09p +7.59p, TTF (Dec) €47.0 -€0.015.
Oil price
Even with the $1 rise today oil will be down this week and as I mentioned yesterday that is due to the recessionary worries which to some extent alleviate interest rate concerns. But the fine line remains, higher for longer is still an option as Powell said yesterday we are ‘not at all confident’ that inflation is beaten but most seem to think that the US has broken the back of the pressure but yesterday his comments hit markets and bond yields rose.
The other thing is that the market is not worried about the Middle East war leading to supply shortages, at least not yet but the US is clearly nervous about its attitude towards Iran and not surprisingly.
Diversified Energy Company
Diversified Energy Company has announced it was awarded ESG Report of the Year by the ESG Awards 2023. The organization rewards those companies that show a progressive, sustainable, and thorough understanding of Environmental, Social, and Governance practices.
“This is an exemplary ESG Report, well written and clearly laid out, explaining exactly what progress the business has made to decarbonise its essential operations,” said the ESG Award 2023 judges. “The report appeals to both head and heart.”
Commenting on the recognition, Teresa Odom, Vice President-Sustainability said:
“From the start, we’ve made a clear commitment to transparency along our ESG journey, and we continue to abide by and lean into that commitment. Our team of approximately 1,600 employees remain steadfast in their mission to responsibly operate and engage with the communities we’re privileged to work in and call home. We will continue using our reports to demonstrate Diversified’s long-term sustainability and value-first operations while promoting our environmental stewardship, social engagement, and community commitment.”
This is excellent news for DEC and repays the long years of investment in time, senior management and of course resources into the ESG area. With an ever more cynical investor pool in commodities in general this goes a long way to being best in class and thus ticking every box in the governance and sustainability slate.
Challenger Energy Group
Challenger has advised that consistent with the terms of the short-term bridge loan (as per announcement of 27 October 2023), part of the proceeds from completion of the transaction for the sale of the Cory Moruga licence (as per announcement of 7 November 2023), have been applied to repayment of the bridge loan. Consequently, the short-term bridge loan has been fully discharged resulting in the Company becoming debt-free.
Another opportunity to kick on with the more exciting parts of the CEG portfolio as this loan is now paid off and leaves the company debt free. A great deal of interest in a number of different aspects of the Uruguay acreage which are in highly desirable post codes.
Southern Energy
Southern has announced that it has closed its previously announced equity financing for aggregate gross proceeds of US$5 million (approximately £4.1 million, CAD$6.9 million) through the issue of 26,630,000 new Common Shares at a price of C$0.26 or 15.5 pence per Common Share. Defined terms used in this announcement have the same meaning given to them as defined in the Company’s announcement released on 1 November 2023 unless otherwise defined herein.
The equity financing comprised of US$2.2 million via a Prospectus Offering of 10,712,387 Common Shares, US$2.8 million via a Placing of 15,853,097 Common Shares and US$0.01 million via a direct subscription with the Company for 64,516 Common Shares. The net proceeds of the Fundraising will be used by the Company to accelerate the completion of its four drilled and uncompleted wells, drilled as part of its Q1 2023 drilling campaign on its Gwinville acreage.
Admission and Total Voting Rights
The new Common Shares issued pursuant to the Fundraising were credited as fully paid, rank pari passu in all respects with the existing Common Shares and were admitted to trading on AIM at 8.00 a.m. (GMT) today.
Following Admission of the Common Shares issued pursuant to the financing, the total number of Common Shares in the Company in issue is 165,718,160. This figure may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in the Company under the FCA’s Disclosure Guidance and Transparency Rules.
I have already commented on this deal, which for what its worth I feel is just what Southern should have done given the rise in natural gas from the $2 low. I know that some shareholders feel that the accretion from starting the production from the DUC’s far outweighs the share dilution at current prices.
Accordingly I remain fully confident in the management team and my 150p TP is very much intact.
Afentra
Afentra has announced that it was notified on 10 November 2023 that Gavin Wilson has purchased a total of 150,000 ordinary shares of £0.10 each in the Company, at a price of 29.99 pence per share.
As a result, the total shareholding in the Company of Gavin Wilson comprises 3,131,666 Ordinary Shares, representing approximately 1.42% of the Company’s issued share capital.
Readers know that I set a great deal of store by directors owning stock and in particular when they buy in the market with cash, this has happened here and the management clearly see this price level as being significantly cheap…
Hunting
I have written about Hunting a couple of times since the recent Capital Markets Day and was recently sent a copy of an independent research report by Equity Development.
https://www.equitydevelopment.co.uk/research/connecting-market-position-and-clear-ambition-1
And finally…
The Prem continues tomorrow with Wolves hosting Spurs, Burnley visit the Gooners, the Eagles welcome the Toffees, the Hatters go to the Theatre of Dreams and the Cherries host the Bar coders. On Sunday the Hammers host Forest and in another ‘epic’ match from the past the Noisy Neighbours visit Stamford Bridge.
Racing is at Aintree and Badger Beer day at Wincanton…
And in the CWC Afghanistan scored 244 against the Proteas this morning, tomorrow England play Pakistan and the Aussies take on the Bangas. Sunday sees tournament favourites India taking on the Netherlands.
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. The writer may or may not hold investments in the companies under discussion
