Malcy’s Blog – Oil price, DGO, Eco Atlantic, Reabold, Solo, Jadestone, Providence & finally

WTI $53.64 -53c, Brent $58.70 -64c, Diff -$5.06 -11c, NG $2.23 +8c

By Malcolm Graham-Wood

Oil price

All over the place is about all one can say about oil recently although Friday and yesterday were both down the conflicting news is almost impossible to gauge. Firstly Chinese retaliation to the US which is bounced back then some more from The White House, following that at the G7 The President apparently offered to meeting with President Rouhani to keep in touch……

Jerome Powell at Jackson Hole was inept as he tried to keep a grip on policy whilst aforementioned Donald stated that he (Powell) and the Chinese were America’s greatest enemies. Powell stated that the Fed would act ‘appropriately’ as and when they were needed to. The trouble is that indicators are very mixed, manufacturing is reporting loss of confidence but my trusty old retail gasoline number must be a positive, last week it averaged $2.57 per gallon which is down 2.4c w/w and 25.3c y/y and when you drive 365bn miles a month as the Shermans do it all adds up to quite a saving…

Diversified Gas & Oil

DGO has signed a binding agreement to acquire two packages of gas-gathering systems in Pennsylvania and West Virginia for $7.5m. It includes 1,700m of pipelines with all the associated kit and whilst it is only a small deal by their standards it makes a lot of sense. Of the 109,000 MMbtu of gas per day,DGO accounts for 60% of that and owning the infrastructure is a no-brainer. This gives the company the ability to charge 3rd party tariffs, control over production and routing of its gas and importantly pricing control leading to a reduction in opex.

All in all wise use of a modest amount of funds which probably pays back in no time, as CEO Rusty Hutson explained, ‘these small, yet strategically complementary bolt-on acquisitions will add scale to our midstream capabilities and provide a high level of optionality with regards to both routes to market and improved pricing.  These acquisitions further diversify our operations and revenue streams and strengthen our long-term ability to control costs and protect margins’.

Eco (Atlantic) Oil & Gas

It has been announced that the Joe well on the Orinduik block, offshore Guyana was spudded on Sunday. Joe-1 is looking at a different feature (Upper Tertiary rather than Lower as found at Jethro) but carries a similar COS as Jethro did with a target of 148.3 MMboe of gross unrisked prospective oil resources.

On an unrelated but most interesting note, Total has announced this morning that it has signed deals with Qatar Petroleum to transfer some of its assets, in particular in Guyana and Namibia, as part of its bilateral deal. For Eco Atlantic this is really interesting as the company has some choice acreage in Namibia where country sentiment is rapidly improving as a continuous stream of big players enter the country and we know that Total only offers its best blocks to its buddy QP…

Reabold Resources

An update this morning on the Mica-1 appraisal well on the Iecea Mare licence on shore Romania. A number of Pannonian reservoirs have been intersected with hydrocarbon shows. Although it is early days, the fact that there are indications of oil and gas with maybe liquids in the deeper gas targets makes this well highly encouraging and also for the ongoing prospectivity of the block. Now, indications of liquids in the deeper gas targets, where have I heard that before? Reabold shares are down this morning, a mis-reading by the market if ever I saw one…

Solo Oil

It’s the Solo AGM today and I am told to expect an up-to-date- presentation which should satisfy shareholders who have been very keen to keep up to speed with the new management’s plans for the company going forward. I will forward the link on Twitter when it’s out and tomorrow in the blog.

Jadestone Energy

Interims from Jadestone this morning which whilst containing little new there does appear to be a ‘narrowing’ of the company’s production guidance after problems in Q2. Apart from that there is a predictably encouraging increase in revenue, profits and cash generation. This will continue to be so as Jadestone builds the business in Australia and Vietnam although the market is rarely forgiving missing guidance although this is mainly due to the weather…Still very much one to watch from this well managed company looking to build in profitable areas.


One day, I presume the RNS from Provvies and Lansdowne will say that the moulah has arrived but it’s not today. This one says that with no sight of the loot the fact that they have been told the cheque is in the post means that they have yet again deferred the backstop, this time until the 2nd of September….

And finally…

Was that the greatest cricket match ever? Or maybe the finest solo effort to win an Ashes match by Ben Stokes? If the likes of Geoffrey Boycott and all the commentating teams say so then it must be so. Anyway, the Sky Plus is jammed with all the highlights and have been playing on a loop since then in Malcy Towers. Next stop Old Trafford although I’m not sure my heart can stand another one like that…

The footy is again becoming predictable, Liverpool beat the Gooners and the Noisy Neighbours went to the English riviera and came back with all the points off the Cherries. Spurs lost at Fortress White Hart Lane to pointless Magpies and in the same vein the Eagles nicked the points at Old Trafford, no longer a fortress…The Chelski went to Norfolk and beat the Canaries

By Malcolm Graham-Wood

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