Share Talk Weekly Energy Sector News – 16th October 2021

The sector is still driven by high prices, according to Ukraine’s pipeline operator, Russia sends less gas via Ukraine to Europe than is specified in the transit contract.

Crude, LPG continues its march towards new market high, the globe struggles for energy resources, here are this weeks energy news highlighted on the Share Talk platform.

Zephyr Energy plc (AIM:ZPHR) provided an update on operational activity on its flagship project in the Paradox Basin, Utah. The Company said 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.

Ascent Resources Plc (LON: AST) update on gas prices at its Petisovci gas project in Slovenia. The Company now expects, at current gas prices and production levels, the PG-10 and PG-11A production wells to generate net production revenues (after extraction, processing and handling costs) of at least Euro 100,000 per month, net to Ascent.

Baron Oil Plc (AIM:BOIL) announced the completion of the increase in its interest in United Kingdom Offshore Licence P2478 (the “Licence”) from 15% to 32% following formal consent given by the United Kingdom Oil & Gas Authority. Work on the outstanding Phase A technical work commitment is ongoing with the key component, that of 3D seismic reprocessing, expected to be delivered during the first half of 2022.

Crude rises to multi-year highs due to global energy crunch

Prospex Energy PLC (AIM:PXEN) announced that CEO Mark Routh has written a letter to all shareholders to re-confirm the Board’s plans and vision for the company. Its strategy to become an operator focused on European development and production gas assets is being moved forward at pace.

Furthermore, Prospex has announced plans to expand its portfolio with more gas to power projects, as well as optimising its current assets. The El Romeral power station in Spain is also about to undergo significant low-cost optimisation and upgrade work, which has the potential of more than doubling the station’s electricity generation output. The Selva field in Italy is expected to head for first gas in the first half of 2022. Read the full letter here.

Aminex PLC (AIM:AEX) announced that it reached a settlement agreement with Tanzania Petroleum Development Corporation, (TPDC), over past gas sales. This will result in a net cash flow of approximately US$1.85mln. It said that the agreement was reached after discussions with TPDC in recent months.

United Oil & Gas PLC (AIM:UOG) reported that production averaged 2,022 barrels of oil equivalent per day during the third quarter. According to the company, Q3 production was 1,619 barrels of oil and 405 boepd gas.

After Gazprom’s gas flow shut down, Moldova requests EU assistance

Union Jack Oil PLC (AIM:UJO) West Newton project had confirmed significant conventional onshore hydrocarbon discovery, and the company provided details of ongoing research at the project. The thick reservoir development of the Kirkham Abbey formation was confirmed by analysis at both West Newton A (and West Newton B) sites. It measured more than 75m thickness in the WNA-1 well, 66.5m in the WNA-2 and 68m in the WNB-1z sidetrack.

David Bramhill, Executive Chairman of Union Jack, commented: “In order to unlock the value potential at West Newton and across the PEDL183 licence, over the coming weeks a number of external studies will be conducted, encompassing a wide range of potential reservoir stimulation treatments, the results of which could be applied to the West Newton series of wells in order to achieve optimum flow rates.”

Longboat Energy PLC (AIM.LBE) has made a new discovery in Norway’s North Sea. The exploration well 7122/6-3 S encountered a 29-metre hydrocarbon column in the primary target in the Middle Jurassic Stø Formation. The top of the reservoir was reached close to prognosis containing high net-to-gross, moderate to good quality sandstone. Data acquisition indicates a gas column of approximately 18 metres in the well over an oil rim.

The Rødhette exploration well (Company 20%), the first well in its fully-funded, seven well exploration programme.

Octopus Energy and RES pledge £3bn for new UK hydrogen plants

Harland & Wolff (AIM:HARL) Notification by Department of Agriculture, Environment and Rural Affairs (“DAERA”) to issue the Marine Licence for the Islandmagee Gas Storage project.

Given the ongoing gas supply crisis within Europe and the critically low levels of gas storage currently available in the UK compared with the rest of Europe, the Company believes that it is vital that this storage project is constructed and commercialised to help ensure security of supply in the UK, as well as support the transition to a Net-Zero economy. The Project’s gas caverns have the ability to enable Northern Ireland to become a net exporter of energy to the wider United Kingdom.

Aminex PLC (AIM:AEX) announced that it reached a settlement agreement with Tanzania Petroleum Development Corporation, (TPDC), over past gas sales. This will result in a net cash flow of approximately US$1.85mln. It said that the agreement was reached after discussions with TPDC in recent months.

Caspian Sunrise plc (AIM.CASP) operational update at the Group’s flagship BNG Contract Area.

Clive Carver, non-executive chairman said “We continue to make the progress we expected with the horizontal wells and with the results from A8 have a further four oil bearing intervals to assess on our deep structures.

With oil international prices now comfortably ahead of $80 per barrel we look forward to further strengthening of the Group’s financial position.”

Malcy’s Blog – Oil price, Kistos, PetroTal, Kosmos, Echo, Hurricane, Union Jack/Reabold & finally

Hurricane Energy PLC (AIM:HUR) Update with Half-year Results & Operational & Financial update. Post period-end, on 15 September 2021, the Company completed the repurchase of approximately 34% of its outstanding $230 million 7.5% Convertible Bonds due in July 2022 at a cost of $62 million (including accrued interest), reducing the par value of Convertible Bonds held by third parties to $152 million

Lancaster EPS production averaged 11,100 bopd for H1 2021 (H1 2020: 14,600 bopd), primarily from the 205/21a-6 well (“P6 well”) alone, with the 205/21a-7z well remaining shut in to manage reservoir voidage and pressure decline.

Revenues of $124.5 million from four liftings of Lancaster crude (H1 2020: $81.9 million from seven listings). Cash production costs† of $24.8/bbl (H1 2020: $18.2/bbl). Generated $75.9 million of operating cash flow (H1 2020: $21.9 million), equivalent to $38.0/bbl (H1 2020: $8.2/bbl)

Echo Energy PLC (AIM:ECHO) Well Intervention Programme, Increase in high-quality oil production potential. The first intervention has now been successfully completed on a well in the Chorillos block. For the operation, a surface hydraulic pumping unit was used to induce flow and over a 100-hour period, the well delivered a cumulative 305 bbls of high-quality oil as part of this intervention and flow induction process, a rate equivalent to c.76 bopd.

Falcon Oil & Gas Ltd. (AIM:FOG) Preliminary Results from Velkerri 76 S2-1 Well – Very Encouraging. Velkerri 76 S2-1 vertical appraisal well (“Velkerri 76”) has been completed, with the well drilled to a vertical total depth (“TD”) of 2,129 metres in the Beetaloo Sub-Basin, Northern Territory, Australia with our joint venture partner, Origin Energy B2 Pty Ltd., a wholly owned subsidiary of Origin Energy Limited.

93 metres of continuous conventional core was acquired in the Velkerri B and AB shales and extensive wireline logging data was collected to enable detailed formation evaluation of the prospective zones within the Amungee Member. The diagnostic fracture injection test (DFIT) is to be carried out shortly and will provide further understanding for future appraisal of the Velkerri wet gas play.

Malcy’s Blog – Oil price, Orcadian Energy, Longboat Energy, Getech, United Oil & Gas & finally

Orcadian Energy PLC (AIM:ORCA) has signed a farm-out agreement with Carrick Resources for Licence P2320, which is the host of the Carra prospect. Carrick Resources will likely pay for seismic data from Carra, and the prospect will be drill-ready.

Steve Brown, Orcadian’s CEO, said: “We are delighted to be co-operating with Carrick to make the most of the exploration potential of our acreage. Progressing Pilot and the prospects close to Pilot is our main focus and partnering with Carrick to develop a drill-ready prospect on Carra means we will leave no stone unturned in our strategy to maximise value from our assets.”

Mosman Oil and Gas Ltd (AIM:MSMN) told investors that the Winters-2 Well has been purged. Winters-2 is located in Polk County, Texas. The Winter-2 well is now drilled to 1,445 feet with surface casing cemented. The intention is to drill to target depth in the next week. Casing has been purchased in preparation to complete the well. Any production flow rates will be announced when they are available.

88 Energy Limited (ASX.AIM:88E) provided an update to the market about its operations for the quarter ending 30 September. The quarter ended with A$36mln of bank deposits and no debt. The Project Peregrine Merlin-1 well revealed oil in multiple stacked sequences. Geochemical analysis showed that light oil was present with an API gravity of 35-42.

ADM Energy PLC (AIM:ADME) Announced the completion of the 16th Lifting (“Lifting”) at the Aje Field, part of OML 113 offshore Nigeria. The Lifting totalled 232,379 barrels with a net share of 21,424 barrels to ADM, which equates to ADM’s profit interest of approximately 9.2%.   The proceeds of the Lifting will be applied against the project debt, contributing to a reduction in the outstanding balance. The nominated offtake partner for the Lifting was Mecuria, a global energy and commodity group.

Diversified Energy Company PLC (AIM:DEC) has appointed Sylvia Kerrigan to its board as an independent non-executive director. Kerrigan brings more than a decade of board room experience and several decades as an executive for the energy, industrial and transportation sectors, the company highlighted.

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