WTI (Nov) $82.94 -$1.00, Brent (Nov) $89.83 -79c, Diff -$6.89 +21c.
USNG $(Oct) $7.77 +5c, UKNG (Oct) 295.0p -35p, TTF (Oct) €188.40 -€15.56.
Oil is back at medium term lows but I’m still not panicking, yesterday the Aramco Chairman said that ‘continued investment is the root cause of the problem as alternatives to fossil fuels are still not readily available’. I have been saying this for a long time and a leading industry executive told me that as much as $6tn of investment has been lost.
So, I feel that Opec+ will continue to defend the $90-100 range and with the combination of a return of China at some stage post-Covid,combined with the eventual hit of the EU measures in December oil will remain tight.
But, the market still correctly takes note of the Fed and worries about recession and inflation and oil is somewhat risk-off as the equity markets plummet. Inventory stocks were again mixed, crude built but less than forecast at 1.41m barrels and distillate has yet to draw much, but watch refinery runs which rose 2.1% last week to 93.6% a high figure. Finally Hurricane Fiona appears to have by passed the Gulf and is on its way over here for next week!
Jersey Oil & Gas
Jersey Oil & Gas, an independent upstream oil and gas company focused on the UK Continental Shelf region of the North Sea, is pleased to announce its unaudited Interim Results for the six month period ended 30 June 2022.
§ Favourable fiscal and macroeconomic developments have further bolstered interest in our on-going “Greater Buchan Area” (“GBA”) farm-out process
§ GBA farm-out process advancing as planned, with continued active engagement with multiple counterparties
§ Substantial progress has been made, with the majority of interested parties forecast to complete their technical due diligence in October 2022
§ Constructive commercial discussions are taking place with potential counterparties
§ Cash position of approximately £8.7 million, with no debt, as at 30 June 2022 – well ahead of the group’s forecast
Andrew Benitz, CEO of Jersey Oil & Gas, commented:
“Great progress is being made with our GBA farm-out process – the key activity for the Group in 2022. Interest is strong, technical studies across the various development solutions are well advanced and commercial discussions are ongoing with serious, well-funded counterparties. Since launching the process, the Company’s engagement strategy has been broadened to advance a range of competing development solutions, thereby providing increased optionality.”
I like the sound of ‘Great progress’ as the outlook for JOG is extremely promising, the results speak for themselves. Activity at the GBA project is going through the gears and of course the company have a very fair wind behind them as ironically the Looney tax investment reliefs make the economics even more attractive than before.
The background is excellent as the GBA project is pretty much unique in terms of a sizeable play, with substantial upside and will appeal to companies of all sizes and from multiple geographies.
Those shareholders who have stuck with JOG have been rewarded this year, the shares have exactly doubled since February but I think the upside is so substantial that when a deal is signed a very high asset value will start to become clear. My optimism on JOG and its management has remained steadfast since the start and the reason why I am so excited now that GBA’s time is imminent.
Longboat has announced that a rig contract has been signed for the drilling of the Velocette exploration well (Company 20%).
Velocette (PL 1016) will be drilled using the semi-submersible Transocean Norge and is expected to be drilled in Q3 2023.
Velocette is a gas-condensate prospect targeting Cretaceous Nise turbidite sands on the eastern flank of the Utgard High in the Norwegian Sea which have been identified following recent seismic reprocessing. Velocette benefits from seismic amplitude anomalies indicative of gas-filled sands located within tieback distance from the Equinor operated producing Aasta Hansteen field (~45 km).
Helge Hammer, Chief Executive of Longboat Energy, commented:
“I am pleased that we have now secured a rig for the Velocette prospect which will be the ninth well in our programme. We are currently drilling the Oswig well and both the Velocette and Oswig prospects have significant follow-on potential that will be derisked by the exploration wells in a success case.”
Speaks for itself this announcement as Longboat continues to drill out the programme with exciting prospects which have legs to follow on with further exploration. Below CEO Helge Hammer talks to me about this programme and how the Longboat plans will be developed.
Core Finance CEO interview: Helge Hammer of Longboat Energy
Getech has announced further progress with its Shoreham Port Green Energy Hub, with the extension of exclusive rights for the development of all port-based hydrogen, ammonia and new onshore wind and solar generation capacity through to August 2027.
In November 2021, Getech announced a period of exclusivity for two years with Shoreham Port, West Sussex, through a Collaboration Agreement. Having completed an extensive engineering programme demonstrating commercial feasibility for the Green Energy Hub, Getech’s exclusivity has now been extended by the Shoreham Port for a 5-year period, taking the project through development, to planned first green hydrogen production and beyond.
Shoreham Port is holding its public-facing Sustainability Week from 29 September to 1 October 2022, where the Green Energy Hub will be one of the portfolio of projects presented.
Dr Jonathan Copus, Getech CEO commented:
“We are pleased with the progress we have made working in close collaboration with Shoreham Port. The updated agreement signed today, with a significantly extended exclusivity period, is a clear statement of intent of the partnership to push forward to develop green hydrogen at the port, contributing to decarbonisation across the Southeast of England.”
Tom Willis, CEO of the Shoreham Port said:
“We are delighted to be continuing the partnership with Getech to develop the Shoreham Port Green Energy Hub. As a Trust Port we have been operating for the benefit of the community for 260 years. This pioneering project has the potential to make a significant contribution to decarbonising the region, creating more good quality local jobs, attracting investment and improving air quality for everyone”.
The exclusivity is good news through to 2027 after Getech worked very hard to appeal to the Port, this means that the long lead times to first green hydrogen production are justified.
The second T20 between England and Pakistan starts today at 1530 hrs, England are 1-0 up from the first game.
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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 blog
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