Malcy’s Blog – Oil price, Genel, Predator, Jadestone & finally

WTI $41.27 +23c, Brent $43.75  +53c, Diff -$2.48 +30c, NG $1.85 +5c

By Malcolm Graham-Wood

Oil price

No wonder people don’t believe/listen to some of these overpaid analysts in the energy sector when they can’t even forecast the inventory stats, as I have said many times  before and notably last week and the week before sometimes they cant even get the sign right.

The EIA stats yesterday showed a draw of 10.8m barrels of crude, analysts predicted a build of 357,000….With a complete mess of the gasoline and distillate stock numbers (both produced a small build, just check production v retail gasoline prices) I’m glad that they don’t predict the refinery utilisation rate which was up 1.6% at 79.5% on the back of increased gasoline and distillate production.

Genel Energy

Genel, in a Tawke licence update this morning, say that gross production in Q2 averaged 102,000 of which Tawke itself produced 58,100 bopd and Peshkabir 43,900 bopd. This is an 11% fall from Q1 as the operator halted development activity to preserve cash, in June however a Tawke licence well intervention campaign was fast-tracked, quickly adding an incremental 15,000 b/d m/m to raise the July average production to 115,000 bopd.

The Peshkabir to Tawke gas reinjection project was commissioned in June and aims to unlock additional oil reserves at Tawke whilst significantly reducing gas flaring at Peshkabir. Genel shares have more than tripled since the lows earlier in the year but this sort of news certainly justifies the strength and flexibility which the management makes its expenditure and distribution decisions and on that basis the company are still looking very attractive at this price.

Predator Oil & Gas

I wouldnt normally write just about a new corporate presentation announcement but given that I am interviewing PRD CEO Paul Griffiths later on Core Finance I thought I would take a look and it is very informative and worth taking a look if you are thinking about investing. www.predatoroil& and CEO Paul Griffiths comments as follows;

“The new corporate presentation is a substantive review of the progress the Company has made since IPO in developing three core businesses with focus 100% on reducing CO2 emissions whilst retaining an ability to deliver revenues and low risk, high impact exploration upside for very low capital outlay. During this period the Company has created, developed and protected a strategic position with respect to CO2 EOR in Trinidad, the search for material gas prospects in Morocco suitable for the gas-to-power market, and the potential to supply LNG to Ireland in the context of meeting EU standards for security of energy supply. This provides the strong framework for future M & A transactions. Updated schedules for the Moroccan drilling programme, including identification of additional prospectivity, for first production from CO2 EOR in Trinidad, and for the LNG project in Ireland are provided.”

Jadestone Energy

Another update from JSE who are really good at keeping the markets in touch with news and strategy which is particularly good in these times. They report Q2 production of 12,566 b/d up 7% on Q1 with the first half giving 12,116 (1H 2019 13,188) as well.

Full year guidance remains on for 2020 of 12-14,000 b/d while gross cash of $113.8m, net of $78.2m and debt of $25.6m is tidy. Capex is down 80% (Sp sit…) but Jadestone is continuing to make cashflow savings, so far this year of over $20m under Project Clover with another $10m in its sights.

Paul Blakeley gives an extensive report at the end of the statement which is also worth reading, it concludes “We have demonstrated our resilience over the past six months and our intent now is to take advantage of the current environment and emerge even stronger, through the remainder of this year and into next”.

Paul and his excellent team set the standard for energy companies of its size and without doubt they punch well above their weight in the sector. The shares are a must on any list and in most oil price scenarios…

And finally…

We are now into the vinegar strokes for the Championship and the prospects of an all Welsh final were scuppered yesterday as the Bees beat the Swans and they will now face the winner of tonight’s semi-final between the Cottagers and the Bluebirds who trail 0-2 from the first leg.

Cricket temporarily moves back to the white ball with England taking on Ireland in a 3 match series starting today at Southampton. No red ball players from the test squad are in ahead of next week’s test against Pakistan.

And Glorious Goodwood continues with the Nassau Stakes and the Richmond Stakes.

Malcolm Graham-Wood

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Disclaimer: Malcy’s Blog is provided for general information about the international oil and gas industry and the companies that operate within it. It does not constitute investment advice and Malcy does not buy or sell shares, warrants or bonds in any company written about within the blog. Information is taken from publicly available sources and any comment is that of the author who does not take any third party comment in the publication.

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