WTI (Oct) $82.36 -$2.65, Brent (Oct) $88.58 -$3.59, Diff -$6.22 -94c.
USNG (Sep) $2.78 u/c, UKNG (Sep) 157.5p -12.2p, TTF (Oct) €64.495 -€4.67.
Oil price
Oil is down another two and a half bucks today as the Bessent plan hasn’t exactly thrilled the markets who have ignored its potential to tip the Iranian economy over the precipice. Mr market appears to like the idea of the Oman/Iran deal for mine removal and policing of the Strait of Hormuz which is still being discussed apparently but I’m not sure if the US or even other Gulf states will agree with.
Another tanker was hit off Oman yesterday and only two tankers transited the Strait yesterday so no signs of the shadow fleet moving around and if the Total CEO and other industry watchers who also believe it are wrong then the six dollar fall is too much.
The API stats out last night showed more of the same, crude built by 4.2m barrels against the whisper of +1.9m but yet again gasoline drew, this time by 3.2m b’s and I continue to note that product prices are not reflecting the sanguine nature of crude oil watchers….EIA numbers tonight and as I understand it the US Government has said that there will be no further releases from the SPR for around two months, bears beware…
UK North Sea
I am running this story, published yesterday in KeyFacts Energy with their permission as I believe that it succinctly covers a very important story for energy investors.
North Sea Fields ‘must not be blocked’ as UK Plans LNG Import Expansion
It would “defy belief” for the UK Government to block new North Sea fields while preparing to spend billions increasing Britain’s capacity to import higher-carbon LNG, Aberdeen & Grampian Chamber of Commerce has warned.
The Sunday Times revealed yesterday that ministers are considering intervention to support new LNG import infrastructure as domestic gas production declines.
The plans are contained in a Department for Energy Security and Net Zero paper which warns of risks to security of supply as North Sea output falls.
AGCC said the proposals expose the consequences of government policy after ministers banned new North Sea exploration licences and maintained a headline tax rate of 78% on the industry.
Block North Sea, you get imports
Chief Executive Russell Borthwick said:
“The hypocrisy of efforts to halt new North Sea production has been laid bare by this paper, which should become essential reading for anyone who thinks blocking domestic production means Britain will somehow stop using oil and gas.
“The government admits we will need gas for decades to come, warns explicitly that the North Sea decline threatens our energy security, and is now considering unprecedented intervention to support additional LNG import capacity, potentially costing billions.
“If you block North Sea production, you get imports. It would therefore defy belief for a Prime Minister to block production at Jackdaw and Rosebank – two fields which alone could provide around 10% of our future gas supply – only to then wave in tankers carrying higher-carbon LNG from overseas.
“Climate action should begin with reducing our reliance on imported energy – but it appears that the only oil and gas some politicians and activists object to is our own.”
Figures from the North Sea Transition Authority show imported LNG has a pre-combustion emissions intensity of around 85kgCO₂e per barrel of oil equivalent, compared with around 28kgCO₂e for UK-produced gas.
‘Simple facts being ignored’
Mr Borthwick added:
“The economic case is just as compelling. Every million barrels produced at home supports 90 times more jobs, generates 150 times more employment taxes and more than 400 times more industry taxes than importing the same amount.
“The North Sea decline outlined in this paper is being driven by government policy, not geology. The Energy Profits Levy must go and Jackdaw and Rosebank have to be consented – and they must be the first of many projects which replace imports with cleaner domestic production, protecting jobs, investment and our energy security.”
Steve Gray, whose venture studio Ventex owns a number of supply chain companies operating across the North Sea oil and gas and renewables sectors, added:
“To increase imports of higher-emitting LNG before utilising to resources of Rosebank, Jackdaw and other North Sea fields makes no sense, either economically or environmentally. It is consumption, not production, of fossil fuels that drives carbon emission – a simple fact that seems to be ignored.
“As things stand in the UK, oil and gas production is taxed at 78 per cent, new drilling licences are banned and all activity subjected to the highest of regulatory standards. Unsurprisingly, this is driving down our domestic production to the point where the UK now produces only half of what it consumes.
“We are replacing that production with imported oil and gas which is taxed at 0 per cent, with zero control over how it is produced or regulated. If we are going to use this energy anyway, surely the responsible choice is to produce as much of it as we can here at home, supporting British jobs and paying British taxes, rather than importing a higher-carbon alternative from overseas.”
A spokesman for DESNZ said:
“The North Sea remains a vital national asset, supporting jobs, growth and the UK’s energy security.
“We are delivering a gas system that is fit for the future, maintaining secure supplies, ensuring value for money for consumers and giving the sector the certainty it needs to invest in Britain’s energy.”
KeyFacts Energy Industry Directory: Aberdeen & Grampian Chamber of Commerce
Rockhopper Exploration
As forecast, Rockhopper has announced the updating of the CPR and following the Navitas announcement, which includes the CDA and the news that a second FPSO will be brought in to add some scale to the process.
The increased NPV is clearly good news and with the company announcing a Capital Access Window on Monday there is going to be a raise which given this news should mean that both existing and new shareholders will be falling over each other to participate in.
For those who didn’t have faith in the Falklands all those years ago this must be particularly galling but for those of us who have championed the province from day one it is most pleasing to see. A massive step forward this week for all concerned and proof if ever any was needed that Navitas is a fantastic operator.
Rockhopper has announced the results from an updated independent technical report conducted by Netherland, Sewell & Associates, Inc. on behalf of Rockhopper on the Company’s Sea Lion field. The Report is effective as at 31 July 2026.
The New Report shows that overall gross resource volumes and Net Present Values have increased when compared with the Company’s previous independent resource evaluation, also conducted by NSAI, effective December 2025, and announced on 2 April 2026 (the “December 2025 Report”).
Importantly, the New Report incorporates the newly accelerated Central Development Area (“CDA”) which the Operator intends to develop utilising the OSX-1 FPSO. The increase in resources combined with the acceleration of development at the CDA and updated commodity price assumptions has led to a significant increase of approximately $788 million in the 2P + 2C Net Present Value of the Rockhopper 35% interest in the Sea Lion development.
A summary of the Key Information (oil only) is provided below:
Reserves
Summary of Gross and Working Interest Net Recoverable Reserves and Future Net Revenue attributable to Sea Lion Field NDA Phases 1 and 2
Rockhopper holds a 35 per cent working interest in the Sea Lion field.
|
Oil (MBBL) Gross (100%) |
Oil (MBBL) Working Interest (35%) |
Future Net Revenue Working Interest (35%) (US$000) Undiscounted |
Future Net Revenue Working Interest (35%) (US$000) NPV10 |
|
|
Proved Undeveloped (1P) |
231,705.0 |
81,096.8 |
2,399,495.1 |
927,773.3 |
|
Probable |
82,546.5 |
28,891.3 |
999,368.1 |
248,055.1 |
|
Proved + Probable (2P) |
314,251.5 |
109,988.0 |
3,398,863.3 |
1,175,828.4 |
|
Possible |
93,915.5 |
32,870.4 |
1,449,350.3 |
329,433.9 |
|
Proved + Probable + Possible (3P) |
408,167.0 |
142,858.5 |
4,848,213.5 |
1,505,262.3 |
Note: Oil volumes are expressed in thousands of barrels (MBBL). Gross (100%) figures represent total field reserves; working interest figures represent Rockhopper’s 35 per cent share. Future net revenue is after deductions for Rockhopper’s share of state royalties, capital costs, abandonment costs, operating expenses and estimates of Falkland Islands corporate income taxes. NPV10 represents future net revenue discounted at an annual rate of 10 per cent. NPV10 should not be construed as the fair market value of the properties. All figures are based on the Base Price Case. See Economic Parameters below.
Contingent Resources
The contingent resources figures below are unrisked – they have not been adjusted for the probability of commercial development. These estimates should not be aggregated with reserves without extensive consideration of the differing degrees of technical and commercial risk.
Unrisked Gross (100%) Contingent Resources – Oil (MBBL)
|
Low Estimate (1C) MBBL |
Best Estimate (2C) MBBL |
High Estimate (3C) MBBL |
|
|
Development Pending |
264,157.6 |
461,826.9 |
608,409.3 |
|
Development On Hold |
65,168.6 |
131,318.8 |
222,543.1 |
|
Development Not Viable |
11,649.9 |
32,959.4 |
95,310.4 |
|
Total |
340,976.1 |
626,105.1 |
926,262.7 |
Unrisked Working Interest (35%) Contingent Resources – Oil (MBBL)
|
Low Estimate (1C) MBBL |
Best Estimate (2C) MBBL |
High Estimate (3C) MBBL |
|
|
Development Pending |
92,455.2 |
161,639.4 |
212,943.3 |
|
Development On Hold |
22,809.0 |
45,961.6 |
77,890.1 |
|
Development Not Viable |
4,077.5 |
11,535.8 |
33,358.6 |
|
Total |
119,341.6 |
219,136.8 |
324,192.0 |
Summary of Unrisked Working Interest (35%) Contingent Cash Flows after Falkland Islands Taxes
Economic analysis has been performed on the Development Pending contingent resources only.
|
Total (US$000) Undiscounted |
NPV10 (US$000) |
|
|
Low Estimate (1C) |
2,849,710.0 |
926,027.1 |
|
Best Estimate (2C) |
6,043,558.0 |
1,781,157.9 |
|
High Estimate (3C) |
8,265,980.9 |
2,182,437.8 |
Economic Parameters
The New Report has been prepared using the following Base Price Case oil price parameters, based on Brent Crude prices adjusted for quality, transportation fees and market differentials:
|
Period Ending |
Oil Price (US$/Barrel) |
|
31 December 2026 |
82.99 |
|
31 December 2027 |
76.74 |
|
Thereafter |
75.95 |
The development pending contingent resources are associated with the proposed development plans for Sea Lion Field and are expected to be produced prior to the economic limit of the field; these plans comprise the CDA Phases 1 and 2 and NDA Phase 3.
For the purposes of this report, the development scenario assumes that once field-level production declines below 125,000 barrels of oil per day, the Aoka Mizu FPSO lease will be terminated and the OSX-1 FPSO will service Sea Lion Field by itself.
Additional Notes
NSAI has also provided estimates of gross and working interest (i) Contingent Gas Resources and (ii) Prospective Oil and Gas Resources. These have not been reproduced in this announcement as there is no plan in place for their development.
The information set out above does not constitute the New Report, but is derived from the New Report. A full copy of the New Report will be available on Rockhopper’s website later today: www.rockhopperexploration.co.uk.
Resource Disclosure
The New Report has been prepared in accordance with the definitions and guidelines set forth in the 2018 Petroleum Resources Management System (“PRMS”) approved by the Society of Petroleum Engineers (“SPE”). The estimates of reserves and resources included in this announcement have not been adjusted for risk.
Union Jack Oil
Union Jack has announced that, at the requisitioned General Meeting held earlier today, all of the resolutions set out in the Notice of Requisitioned GM at the end of the Circular and announced on 27 July 2026 were duly passed.
As a result of the passing of the resolutions, David Bramhill, Joseph O’Farrell and Dr Zac Phillips have been removed from the Board with immediate effect and Craig Howie and John Americanos have been appointed to the Board with immediate effect.
Mr Howie and Mr Americanos have both served as directors of Union Jack previously, and each returns to the Board with considerable shareholder support.
Craig Howie was appointed with 90.85 per cent of the votes cast in favour and John Americanos with 90.82 per cent of the votes cast in favour.
Of the votes cast, 90.89 per cent were in favour of the removal of David Bramhill, 90.55 per cent were in favour of the removal of Joseph O’Farrell and 90.89 per cent were in favour of the removal of Zac Phillips.
Mr Howie will serve as Union Jack’s Executive Chairman and Mr Americanos as Executive Director, ahead of the appointment of independent non-executive directors to provide a rigorous standard of boardroom oversight as soon as practicable.
Craig Howie, incoming Executive Chairman of Union Jack, commented:
“Following the Board changes announced today, Union Jack’s immediate priority must be an urgent right-sizing of its central cost base, particularly with regard to directors’ remuneration.
“This should be accompanied by significantly improved investor communication and corporate governance.
“Supported by a fresh commercial and technical approach, the incoming Board also needs to make considerably more effective capital allocation decisions at the asset and corporate levels, to preserve and grow value going forward.
“We look forward to updating shareholders once the most urgent steps have been taken, including the selection and appointment of independent non-executive directors to ensure the highest standards of boardroom oversight.”
I’m not allowed to comment on UJO at the moment under takeover rules but think it’s important to make sure that this RNS is seen by those who may not have noticed.
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. The writer may or may not hold investments in the companies under discussion.
