WTI $81.31 +87c, Brent $84.00 +82c, Diff -$2.69 -5c, NG $5.60 +1c, UKNG 256.02p +9.57p
By Malcolm Graham-Wood
Oil price
Oil continues to tickle higher, yesterday the bullish comments from Russian Energy Week were added to by the Saudis who said that there would be no need to alter the group’s strategy for the time being. The IEA added to the other two reporting organisations and not much changed, surprise surprise 4Q demand is rising which might lead to inflation. They also said that Non-Opec supply was down and put together that would all make a bigger 4Q stock draw.
So no shocks there, the EIA inventory stats did actually show a 6.1m hike in crude stocks but surprisingly gasoline drew 2m barrels with distillates unchanged.
Zephyr Energy
Zephyr has provided an update on operational activity on its flagship project in the Paradox Basin, Utah. The Company is pleased to announce that all equipment and materials required for hydraulic stimulation (including water tanks, water and proppant materials) have been successfully mobilised to the State 16-2LN-CC well pad, and that completion operations are scheduled to commence on Monday 18 October 2021.
It is anticipated that completion of the well will be finished in under a week, at which point the Company will commence production testing. The Company will provide an update on initial production volumes as soon as possible thereafter, once the well has cleaned up and testing is completed.
Colin Harrington, Zephyr’s Chief Executive, said:
“In spite of the significant supply-chain and weather issues impacting our industry, I’m delighted that we’re ready to commence completion operations in the manner we expected. I’d like to thank our operations team and third party contractors for their hard work and professionalism in helping us overcome these widespread logistical hurdles.
“I’d also like to once again thank our Shareholders for their continued support of Zephyr. Last night, I was honoured that Zephyr won the “Best Performing Share Award” at the 2021 AIM Awards event – and I am fully aware that this achievement would not have been possible without the extraordinary dedication of our team, our Board, our advisers and our investors. While I’m sorry I could not attend the event in person and am proud of what we’ve achieved over the past twelve months, I want to reiterate that my focus remains one hundred per cent on our current operations and future performance. “I look forward to reporting from the well site next week as we launch a new chapter in the Company’s history with the completion of the first in a series of planned wells on our Paradox asset.”
I don’t need to add much right now as Colin has pointed out everything needed and that the imminent work on the State 16 well is going to be an exciting follow in coming weeks. The award was rightly theirs and I add my congratulations but I wouldnt rule out further plaudits as I’m still a massive bull of Zephyr going forward, this management is top notch.
Kosmos Energy
Kosmos has announced that the offering announced yesterday post the Oxy deal was priced at $3.30, a significant premium to the previous close. This reflects the fact that the market feels that this is a good deal for the company and as I commented yesterday I thought that Kosmos got a very good price. Add that to the fact that some people think that the shares have been under-performing led to a stampede for the shares.
Trinity Exploration & Production
Jeremy Bridglalsingh, Chief Executive Officer, commented: “We continued to develop our business during the period, maintaining existing assets, laying the foundations for longer-term production growth from our existing portfolio while also pursuing new growth opportunities. The Government’s focus on stimulating the sector could provide significant opportunities for Trinity and we look forward participating in the new bid rounds to be launched.
“It goes without saying that this was an extremely difficult period for the Company, with the passing of Bruce Dingwall affecting everyone in the business, and the operational challenges posed by COVID-19 continuing. The strong performance reported today is a testament to Bruce’s legacy, and means that we are able to look forward with confidence as we seek to develop the numerous opportunities available to us, building on our growing reputation in the region which has been further enhanced by Derek Hudson’s recent appointment to the Board.
Gran Tierra
Gran Tierra yesterday provided an Operations and Financial Update in which it achieved Third Quarter 2021 average production of approximately 29,000 BOPD, Up 26% from the Prior Quarter. Increased Current Average Production to Approximately 30,600 BOPD, Highest Since February 2020 and paid Down Credit Facility Balance To $140 Million.
Gary Guidry, President and Chief Executive Officer of Gran Tierra, commented:
“After the challenges with blockades during the second quarter of 2021, we are very proud of how our teams safely and diligently ramped operations back up throughout our Colombia portfolio. During the third quarter of 2021, with production back up to an average level of approximately 29,000 BOPD and an average Brent oil price of $73.23/bbl, Gran Tierra was able to further strengthen its balance sheet. The fourth quarter of 2021 is off to an even stronger start with the Company’s average current production2 at approximately 30,600 BOPD and Brent2 averaging $81.74/bbl, which has allowed us to pay down Gran Tierra’s credit facility balance to $140 million as of October 8, 2021, down $50 million from a balance of $190 million as of December 31, 2020.
With production restored, a successful 2021 drilling program, strong world oil prices and a strengthened balance sheet, we are very excited about the fourth quarter of 2021 and all of 2022.”
Kistos
I understand that some people didnt get the blog by email yesterday, mine seemed to work but otherwise were intermittent. Advisors said that it was a temporary outage and if retried would work. As a result some people may not have seen the interview that I did with Kistos CEO Andrew Austin which I have added the link below.
Core Finance CEO Interview: Andrew Austin, Interim CEO, Kistos
And finally…
Back to the Prem where there isn’t a stand-out fixture but a couple of local derbies. Tomorrow sees the Hornets hosting Liverpool, the Midlands derby as Wolves go to the Villa, the Foxes host the Red Devils, Burnley visit the Emptihad, the Canaries host the Seagulls, the Saints host Leeds and in London Chelski visit the B’s. Sunday sees the Hammers visiting the Toffees and under new ownership Magpies entertaining Spurs.
A cracking day for racing fans tomorrow with Champions Day at Ascot always the denouement of the flat season. Who wouldn’t want to see Trueshan v Stradivarius or see Snowfall, Palace Pier and Mishriff takes on Adayer.
There is also a side issue as the jockeys title is still up for grabs. With 2 days to go Oisin Murphy leads William Buick by 151 to 149…
And at 1500 UK time today its the Chennai Super Kings v Kolkata Knight Riders, in the IPL 2021 Final…MS Dhoni vs Eoin Morgan must be worth a glance.
The opinions expressed here are those of the author
Malcolm Graham-Wood
Read MoreDisclaimer: 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
