WTI (Sept) $96.42 -84c, Brent (Oct) $101.83 +16c, Diff -$5.41 -$3.95.
USNG (Sept) $8.13 -56c, UKNG (Sept) 376.11p +16.11, TTF (Sept) €199.2 -€3.35.
Oil price
A mixed bag above so lets clear that up on what is the last trading day of the month. Brent for September has expired and with the October contract comes a shifting downwards for the differential, either way it will be an up week.
All the usual influences happened so I won’t go through them again, Janet Yellen saying yesterday that the US was ‘not seeing signs of a recession now’ just shows how different it is on the political side of the fence. When the US comes back from the summer vacation it will be full on for the midterms which will be most interesting.
Next week sees the Opec meeting on Wednesday, again fairly predictable, the usual release which the cartel will not be able to deliver.
Prospex Energy
Prospex has announced that Po Valley Energy has received approval for the production concession at the Podere Maiar gas field located in the Po Valley onshore in northern Italy, which lies within the Selva Malvezzi production concession (‘Selva’). Prospex holds a 37% working interest in the Podere Maiar licence with the Operator holding the remaining 63%.
Highlights
· Production Concession at Selva fully approved by Italy’s Ministry of Ecological Transition
· On the assumption that the joint venture parties meet the development costs and secure the necessary contractors to undertake the development work, first gas is anticipated in H1 of 2023
· Contracts can now be awarded and first payments made to the contractors for the construction of the automated gas plant facilities, the installation of a 1,000 metre four-inch pipeline and the connection to the national gas grid network operated by SNAM
· Prospex will now pay its 37% share of the €757,000 SNAM Bond (€280,090 net to Prospex) necessary to procure the connection to the national gas grid
Mark Routh, Prospex’s CEO, commented:
“We are extremely pleased to have received the final approval of the Production Concession from the Italian regulatory authority, the Ministry of Ecological Transition. This allows work to commence immediately to connect the suspended Podere Maiar-1 well to the adjacent National Gas Grid operated by SNAM. I acknowledge the hard work and advanced planning by the Operator’s team in Italy whose perseverance and professionalism has led to securing this major milestone for both Po Valley and Prospex.
“The development of this indigenous gas field is good for local jobs, boosts the economy of the region and although relatively small, this gas production will go some way towards alleviating the energy and gas supply shortfalls being experienced in Italy and indeed the whole of Europe.”
This is very good news for Prospex and one that they have been waiting on for a while, Mark Routh tells me that this is a ‘significant milestone’ for the company. Given that these timing issues are expected in Italy regulatory approvals are worth celebrating.
It also comes after a raise earlier in the week whereby PXEN financed some £1.87m at a coupon of 12% in order to pay for costs at Selva which have been rather running away with the operator. Overall it’s been a good week for Prospex.
Europa Oil & Gas
Europa has announced that the Irish government Department of the Environment, Climate and Communications has advised the Company that its FEL 4/19 licence will remain live until the DECC notifies the Company otherwise.
On 7 August 2019, Europa announced the award of FEL 4/19, the terms of which are standard and include:
· Validity for 15 years, commencing on 1 August 2019; and
· Division into four phases, the first of which ends on 31 July 2022.
The Company has completed all work commitments for the first phase of the licence and in March 2022 applied to DECC for an extension to the first phase in order to carry out further technical studies and allow more time to secure a farm out of the licence. The licence extension application remains under review, and whilst there can be no guarantee the extension will be granted, the DECC has confirmed that the licence will remain live, pending a decision on the application, regardless of how long it takes for DECC to make the decision.
Simon Oddie, Europa’s CEO, said:
“FEL 4/19 contains the large, low risk, Inishkea gas prospect and is a strategic asset that can potentially provide a reliable source of low emission energy for Ireland and play a key role in the transition to renewable green power. Gas from the Corrib field, adjacent to the Inishkea prospect, is one of the lowest carbon-intensity gases in Europe, much lower than long distance pipeline gas from Norway, the UK or the Russian gas piped to Europe.
Given that Ireland will continue to require gas into the foreseeable future, having recently agreed plans to build new gas-powered electricity plants, it makes sense to keep this potentially valuable source of indigenous gas available. We therefore hope that the requested licence extension will be granted as soon as possible, which will allow the Company to carry out further technical studies and seek a project partner.”
I havent covered EOG for ages and was tapped up by the IR guy who said I should restart coverage as the CEO was about to do a road show and that I would be honoured with a meeting. Well that hasn’t happened yet but in good faith as I hear there is much going on I’m on the case!
The news is undoubtedly good today even though the Irish Government’s energy policy over recent years has been noticeably lacking in any knowledge of basic supply and demand energy economics seemingly thinking that power generation comes from a magic green pot of money. One other notable player in the Irish energy market has been able to drag this horse to water, hopefully it will realise the error of its ways.
More on Europa if and when I get that magic meeting invitation…
And finally…
Another big summer weekend of sport but horror of all horrors English League football is back.
Sunday sees the Womens Euros final between England and Germany at 1700 hrs whilst tomorrow night the Charity Shield is at Wembley between Liverpool and the Noisy Neighbours. The Championship and all leagues below start their seasons tonight and over the weekend.
The Proteas easily beat England in yesterday’s 2nd T20 so the series will be decided at the Ageous Bowl at 1430 on Sunday.
The F1 caravan rolls on, the Hungarian GP takes place on Sunday at the Hungaroring, Mogyorod.
Glorious Goodwood continues on the Sussex Downs, the feature today is the King George Qatar Stakes and The Golden Mile.
And of course The Commonwealth Games are under way after last night’s gala opening ceremony, the Brummie games as they are to be known as should be full of fun.
The opinions expressed here are those of the author
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
