Malcy’s Blog – Oil price, Predator, VOG, SDX, Gulf Keystone – And finally

WTI $57.51 +17c, Brent $64.23 +41c, Diff -$6.72 +76c, NG $2.42 +13c

By Malcolm Graham-Wood

Oil price
With the follow-on from G20 and Opec+ and the Independence Day holidays it was a tiring week for oil that fell slightly, WTI was down 95c and Brent 51c. Traders are still arguing whether the inevitable fall in stocks caused by lower output from Opec+ (confirmed after Reuters June numbers) will offset demand numbers hit by GDP worries, we shall see.

I have been saying for many years that Deutsche Bank have been causing trouble for themselves by being in the wrong markets and working off a massively overloaded cost base in investment banking. Had they decided to take the bull by the horns way back then they would have saved themselves a heap of money but at least hundreds of people have lived a life of luxury at the company’s expense for years.

Predator Oil & Gas
Comments from Predator following the Irish Offshore Operators Association statement, with particular reference to implications for indigenous gas at Ram Head in the Celtic Sea now that the Government is now not proceeding with the Climate Emergency Bill.

It makes the point that indigenous gas gives Ireland ‘security of supply, a lower carbon footprint as gas replaces imported coal, tax revenues to fund investment in renewable energy ensuring that energy is affordable and accessible to all’.

CEO Paul Griffiths also notes that ‘this is a pragmatic approach being adopted with respect to the importance of developing indigenous gas offshore Ireland’. This will mean that Predator can now go ahead and re-approach those ‘substantive’ potentially interested parties with a view to developing the two gas discoveries that lie in Ram Head.

Victoria Oil & Gas
On Friday afternoon, usually a graveyard for putting out announcements, VOG decided to update the market on 2Q numbers which unless I am mistaken only added five days of trading to the last statement. Anyway, final Q2 numbers show gas production of 9.66 mmscf after Q1’s 10.10 mmscfd with gas sales of 882 mmscfd (903).

Maybe more importantly the company announced that ENEO invoices had now been settled for January and February and are confident that they will from now on be paid in line with their binding agreement…Finally CHL has commenced proceedings against GDC and VOG for royalties it believes it is entitled to under the Royalty Agreement which VOG vigorously defends.

SDX Energy
An operational and corporate update from SDX this morning where the company say that South Disouq ‘continues on schedule and on budget’ for first gas in Q4 2019. Now, call me old fashioned but I suspect that some investors may remember that South Disouq was scheduled for first gas in 1Q 2019 and the by the end of 2Q 2019 so this is hardly ‘on schedule’. With everything now coming together if you can forget the fuzzy 20:20 hindsight it is at long last good news and the interim CEO is taking ownership of the timeline with ‘new guidance’.

Good news also from Morocco where the planning for the 12 well campaign in the country has commenced and the company expects to be commencing the campaign in 4Q 2019 targeting 15 BCF of gross unrisked prospective resources. Other good news is that production appears to be in line to slightly ahead of guidance for the year and the company has cash of $11m and an undrawn $10m EBRD facility earmarked for Morocco.

Gulf Keystone Petroleum
Gulf Keystone has confirmed that the previously announced buy-back of $25m will start with an initial tranche of $15m. This will start immediately and be done at arms length by the company’s brokers.

And finally…
So we now know the line up for the CWC semi-finals, India will play New Zealand tomorrow and after losing to South Africa, Australia will play England on Thursday.

Enable won the Coral-Eclipse without being 100% fit so will be interesting in the King George and the Juddmonte before another tilt at The Arc.

Tyson Fury has announced that he is to fight Deontay Wilder on February 22nd in Las Vegas, Nevada. Wilder has to beat Luis Ortiz in his rematch but that shouldnt trouble him…


By Malcolm Graham-Wood


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