Share Talk Weekly Energy Sector News Round-Up, 23rd January 2022

Russian gas pipeline exports have fallen 41% since a year ago. Let’s take a look at what these scenarios might be and what they could mean for Europe, which depends on Russia for around a third of its gas. Europe is currently suffering from the worst energy crisis since the 1970s.

Gazprom, Russia’s state-owned energy company, stated that it has not booked any capacity for gas transport to Europe via the Yamal pipeline next month.

What would a war in Ukraine mean for Europe’s energy crisis?

Gas stockpiles are at an all-time low. Prices have more than doubled over the past six months due to fears of war and capped shipping from Russia. President Vladimir Putin repeatedly stated that he does not plan on invading Ukraine.

JPMorgan economists said Friday that international oil prices could rise to $150 per barrel in the first quarter of 2022 if there is a conflict between Russia and Ukraine.

This projection was realized when Brent oil has jumped about 12% this year, trading at close to seven-year highs due to strong demand. Brent oil traded at close to $88 per barrel during Friday’s session.

Europa Oil & Gas (Holdings) plc (EOG: AIM) updated the market on the positive conclusions of a study conducted by ERCE into its 30%-owned Wressle oil field in the UK, which pointed to a significant uplift in production oil volumes – provided certain conditions were met. Europa holds a 30% working interest alongside Egdon Resources (30% and Operator) and Union Jack Oil (40%).

Union Jack Oil PLC (AIM: UJO) stated to investors that the West Newton ERCE estimates that a rate of 1,216 barrels of oil per day (“bopd”) would be possible, whilst maintaining a flowing bottom hole pressure above the oil saturation pressure

This assertion is based upon the results of a modelled rate analysis that was fed with data from a well test programme that was completed in the second half of last year. It is then drilled into a natural gas zone.

Chariot Limited (AIM: CHAR) Notice of Investor Webcast at 12 noon GMT on Wednesday 26 January 2022. 

Chariot announced that it had completed drilling operations at Anchois field offshore Morocco. After making a significant discovery, reported that there were over 100m of net pay in the Anchois-2 well. This will allow for future production.

A statement stated that the company also linked the rig to the Anchois-1 well, which was drilled in 2009, to prove its viability as a producer.

ADM Energy PLC, (AIM: ADME). stated that it raised £561,000 through a subscription from Optima Resources Holding Ltd in order to fund business development, acquisitions, and investment opportunities.

The AIM-listed natural resource investment company offered 51mln ordinary shares in the subscription of Optima for 1.11p each.

88 Energy Limited (ASX:AIM: 88E) advise that its application to join the OTCQB Market in the United States has been accepted and the Company’s shares are now listed for trading under the code EEENF. The OTCQB Venture Market is for entrepreneurial and development stage US and international companies.

China has been importing Iranian oil under the radar despite violating U.S. sanctions

Advance Energy PLC, (AIM: ADV) Buffalo-10 well intersected the primary target, Elang reservoir. Early data indicate that hydrocarbons may be present.

The top Elang reservoir was reached at depths of 3,338 meters. Project operator Carnarvon Petroleum said that this was “approximately 80m lower to prognosis” and beyond the pre-drill range.

Eco Atlantic Oil & Gas Ltd (AIM-ECO). has increased its interest in JHI Associates Inc., a junior explorer off Guyana. It is partnered by Exxon in Canje Block.

AIM-quoted Eco purchased 800,000 shares in JHI, valued at around PS312,000. Eco exchanged 1.2mln Eco shares. Eco now holds 5.8mln JHI shares. This represents a 7.35% stake.

Serica Energy plc (AIM: SQZ), releases a Corporate Update presentation for the year ended 31 December 2021 which can be found on the Company’s website at www.serica-energy.com

Sound Energy PLC, (AIM: SOU). made a decision to purchase Angus Energy to diversify and expand its portfolio.

This comes just a month after Angus launched a strategic review in order to evaluate the possibility of selling the company.

Malcy’s Blog – Oil price, Advance Energy, Union Jack Oil, Egdon Resources, Europa Oil & Gas, Longboat Energy & finally

Genel Energy PLC, (LSE: GENL) informed investors that 2022 production is expected to be at the same level as 2021 but that higher oil prices will boost financials.

Based on US$75 per barrel of oil, it expects to generate US$200mln in free cash flow by 2022. It also noted that every US$10 increase in crude oil prices will have a corresponding US$50mln cashflow impact.

BP and Shell were awarded two of the most valuable licences in the auction of Scottish offshore wind farms sites by the Crown Estate.

Both oil and gas giants are undertaking rapid green energy expansion programs. They bid approximately PS86mln for the sites that they were awarded.

ADM Energy PLC, (AIM: ADME) updated investors about the legal proceedings in Nigeria. The court informed the company that it has suspended the matter until March 1, but an interim injunction remains in place.

K.O.N.H, the company’s partner, initiated proceedings in December to resolve a dispute about KONH’s ownership stake in Noble Hill-Network Limited. (NHNL), which holds the risk-sharing contract for the NW OML 141 assets.

Hydrogen Utopia Intl (AQSE: HUI) Guy Peters, Executive Chairman Interview

88 Energy Ltd, (AIM:ASX: 88E). stated that it is on track to complete a February spud at Alaska’s Merlin-2 well on Alaska’s Nort Slope. The Arctic Fox drill rig has been commissioned and is ready for mobilisation. Construction works on the ice road are also underway.

The company updated with the following report for the quarter ended 31 December 2021.

MetalNRG (LON: MNRG) Initiation of Coverage. Well-positioned to create substantial shareholder value by developing highly compelling green energy, gold & uranium projects.

A proven management team has adopted a really sound corporate strategy of investing in advanced stage exploration and development projects where they can use their know-how to establish cash flow relatively quickly. Recent months have seen BritNRG become problematic and resolving this issue could free up capital that could be better used elsewhere. In any case, oil had always only been seen by the team as merely a stepping stone on the way towards green energy.

Russia’s Gazprom does not plan to export Europe gas via the Yamal pipeline in February.

Mosman Oil and Gas Limited (AIM: MSMN) announced an update in respect of its Falcon project which forms part of the Champion Project in East Texas. Mosman holds a 75% working interest in the Falcon-1 well, the first well to be drilled at the project.

At Falcon-1, an additional Frio sand zone has been perforated at a depth 7,457-7,460 feet. The well has flowed on test at a rate of 1,000 mcfd, but due to the current choke size of 7/64 it has been producing at an average rate over the last 5 days of 576 mcfd (c 113 boepd gross). To balance short term cashflow and long optimize gas recovery over time, the production strategy is to periodically increase the choke size and monitor wellhead pressures. The first increase in choke size planned for this this week is to increase the choke to 8/64.

The current production rate is an increase of 23% compared to average flow rate of c 92 boepd (gross) in the quarter ended 30 September 2021.

Angus Energy PLC (AIM: ANGS) Strategic Review, Formal Sale Process (“FSP”) Update. The Company announced that it has had at least six bona fide approaches to participate in the FSP and/or other indications of interest in a potential offer for either all of the shares of the Company or the Company’s licence interest in the Saltfleetby Gas Field (“Parties”).

George Lucan, CEO, commented:

“We are pleased with the expressed level of interest in the Company or in its principal asset,and will proceed with our formal sales process with due professionalism, expediency and confidentiality to achieve the best possible result for all of Angus’ shareholders.”

Europe Needs a New Gas Storage Strategy. Gazprom did not fill its German gas storage units in time for winter and has not done anything to remedy that situation as the season progresses.

Europe has subcontracted its energy security for President Vladimir Putin. Now it is paying the price.


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