Share Talk Weekly Energy Sector News Round-Up, 9th April 2022

Share Talk closed the week with an update from Roland Wessel, CEO and Director of Oilex Ltd. The company is going into production in India, and cash flow is positive, plus Roland said a Cambay C-77H refract announcement will be made at the beginning of next week.

Oilex’s Chief Executive Officer, Roland Wessel, said:

“The re-establishment of production from the Cambay gasfield occurred soon after the Indian government announced that the price of domestic gas would more than double from $2.9 per mmbtu to $6.1 per mmbtu. This will provide a material benefit to Oilex’s cash flow.”

In Friday’s closely watched report, Baker Hughes Co stated that the oil and gas rig count, which is an indicator of future output, rose 16% to 689 during the week to April 8. This was its highest level since March 2020.

Baker Hughes stated that this brings the total number of rigs up to 257, or 59%, compared to last year.

Hydrogen Power The Future Of Energy ITM Power Vs Ceres Power Review

Aura Renewable Acqns (LON: ARA) Admission to listing on the Official List and to trading on the London Stock Exchange.

The Company will pursue opportunities to acquire businesses in the renewable energy sector. The Company intends to consider opportunities within the renewable energy sector focusing on businesses operating in the global renewable energy sector supply chain, particularly participants in the wind, solar, biomass, hydropower and green hydrogen supply chain ranging from raw materials resourcing to power generation, energy storage and recycling.

Angus Energy PLC (AIM: ANGS) Update on installation schedule at Saltfleetby. The Company updates on the progress of its installation and commissioning schedule. Additional noise abatement and other modifications have occasioned some small delays in the arrival of the compressor skid but with no impact on the overall timeline.

The Company continues to target First Gas by 1 June allowing for one full month of unhedged production.

TPI provides its latest research note on Zephyr Energy plc (AIM: ZPHR)

United Oil & Gas PLC, (AIM: UOG). informed investors that it had received approval from Italy’s Ministry of Ecological Transition for the transfer of UOG Italia ownership to Prospex Energy in accordance with the previously announced disposal agreement.

In a statement, the company stated that completion will now take place when the deed is legally executed and funds transferred by Prospex from United to cover the remaining acquisition costs.

Chariot Ltd, (AIM: CHAR) most recent announcement is evidence of the company’s shift towards a wider transitional energy business. Stockbroker Peel Hunt stated in a note that the latest announcement was further proof. The company announced that it had signed a memorandum of agreement with Port of Rotterdam International in order to establish supply chains for green hydrogen and ammonia imports into the Netherlands and the Netherlands.

Angus Energy PLC (AIM: ANGS) Sound Energy plc not to proceed with a possible offer for Angus Energy Plc. Termination of Formal Sale Process and update on Strategic Review.

George Lucan, CEO, commented: “Our Competent Persons Report of October 2021 gave a P90 valuation of £24 million (P50 of £34 million) to our interest in Saltfleetby, since which time confidence in our ability to achieve First Gas in June has risen, and the wider market has reflected this in our own share price.

After lengthy discussions on a possible combination with Sound, which we consider to have had merit, we were unable to agree on terms

Peel Hunt, a City broker, reiterated its ‘buy” recommendation and 100p target for Eco (Atlantic & Gas Ltd). It confirmed that it had successfully completed a £19.5mln City fundraising to finance its part of a South African drill program.

To reach the Peel target, the stock would need to be more than triple its current value, which is 15%, at just over 30p.

Oilex Ltd (ASX:AIM: OEX) Cambay India Production and C-77H Re-frac Update. Subsequent to the receipt of the Consent to Operate from the Gujarat Pollution Control Board, production has re-commenced on the Cambay field together with gas sales.

Oilex’s Chief Executive Officer, Roland Wessel, said:

“The re-establishment of production from the Cambay gasfield has occurred soon after the Indian government announced that the price of domestic gas would more than double from $2.9 per mmbtu to $6.1 per mmbtu. This will provide a material benefit to Oilex’s cash flow.”

88 Energy Limited (ASX:AIM: 88E) Project Icewine – Preliminary Mapping Complete. Update Pending, Farm-In Discussions Advancing. The company said they are pleased to report that the ongoing assessment of the SMD, SFS and BFF play fairways onto its Project Icewine acreage (75% 88 Energy WI) is progressing as planned.

Preliminary independent third-party mapping using available well information from presentations publicly released by neighbouring acreage holder, Pantheon Resources (AIM: PANR) plus internal 88E data, including Icewine-1 and Icewine-2 well logs and existing 2D seismic, indicates that all play fairways extend into the Project Icewine lease holding.

Canadian Overseas Petroleum Limited, (LSE: COPL) issued a stock exchange statement in response to “unfounded market speculations”, as well as disinformation posted on social media.

In the statement, the company reiterated its goals for 2022 and addressed internet speculations about its 2021 annual filings, which were submitted to the company’s website recently.

Empyrean Energy PLC (AIM: EME) Block 29/11, China – NH9 rig on Jade location. COSL owned NH9 rig has arrived safely on location at the Jade Prospect. Operations to anchor the rig on location have commenced

Spudding of LH 17-2-1 well over Jade Prospect is now anticipated to commence on or around 10 April

Empyrean is the operator of Block 29/11 in China and has 100% working interest during the exploration phase. In the event of a commercial discovery, its partner, China National Offshore Oil Company (“CNOOC”), may assume a 51% participating interest in the development and production phase.

Zephyr Energy PLC (AIM: ZPHR) Production update from Williston Basin, North Dakota, U.S. portfolio. At the end of March 2022, Zephyr had 185 wells available for production, including 7 wells that came online during the first quarter of the year.

An additional 16 wells are expected to be brought online and be available for production over the next six months. Q1 operational production rates from the Company’s Williston Basin portfolio averaged 1,643 barrels of oil equivalent per day (“boepd”) net to Zephyr, ahead of previous expectations and representing a record-breaking production quarter for the Company.

80% of produced volumes were oil

Russian gas deliveries to Europe via the Yamal-Europe pipeline reversed direction to flow from Germany to Poland on Thursday morning and supplies via Ukraine also eased, all in line with requests from customers.

Gas flows switched to an eastward direction into Poland at the Mallnow metering point on the German-Polish border on Thursday morning after flowing westward overnight, data from pipeline operator Gascade showed.

SDX Energy Plc (AIM: SDX) updated on well-testing operations at the recent SD-5X (Warda) discovery well (SDX Working Interest: 36.85%) in the South Disouq Development lease.

The well was perforated in the basal Kafr El Sheikh gas sand and was tested on 30 March 2022, opening the well for a two-hour clean-up period only. The well flowed at a controlled rate of 10.4 MMscf/d on a 26/64″ choke. When connected, it is anticipated that the well will produce at an optimum stabilised rate of 8-9 MMscf/d.

Kistos PLC (LON: KIST) Final results for the period from incorporation to 31 December 2021. The numbers referred to as “actual” in the announcement include the results of Kistos plc from incorporation on 14th October 2020 to 31 December 2021 and the results of Kistos NL1 and Kistos NL2 from acquisition on 20 May 2021 to 31 December 2021. The “pro forma” numbers include the results of Kistos plc and the results of Kistos NL1 and Kistos NL2 from 1 January 2021, which was the effective date of the acquisition and so the date from which Kistos economically benefitted from the assets to 31 December 2021.

Pantheon Resources (AIM: PANR) Confirmation of Upcoming Webinar

Confirms that management will be hosting a Shareholder Presentation and Q&A session (“Webinar”) at 5:30 pm British Summer Time on Tuesday 26 April 2022, which will be open to all shareholders and interested parties.

In this Webinar, the management team will discuss the outcomes and conclusions from the highly successful Theta West and Talitha #A drilling and testing operations this season, implications for future project definition and development, as well as next steps in the operational programme including an insight into the Alkaid #2 well planned for July 2022.

According to IGas Energy PLC, (AIM: IGAS) Stephen Bowler, chief executive, the rapid development of UK shale can reduce supply issues and high prices. It also helps reduce emissions compared to imported gas.

In Wednesday’s full-year results statement, the IGas chief made the comments. This comes a day after the UK government announced that it would quickly review its stance on shale gas and fracking. Fracking has been banned in the UK since 2019.

i3 Energy PLC (AIM: I3E) stated that its Canadian subsidiary had a record reserve at the end of 2021 and that the quarter just finished saw its highest-ever production.

In the last three months, it was equivalent to 20,300 barrels per day. This includes 61.1mln standard cubic feet of gas, 6,290 barrels of natural gas liquids and 3,522 bbl/d oil. It also includes 316 boepd royalty interest production.

Egdon Resources PLC (AIM: EDR) Government Announcement on Shale Gas. Egdon holds a significant portfolio of shale gas licences covering an area of 151,742 net acres (614 square kilometres) with estimated mean volumes of undiscovered gas in place of 37.6 trillion cubic feet. Egdon’s primary focus is the Gainsborough Trough where the results from the 2019 Springs Road-1 well highlighted a potentially world-class resource in the Gainsborough Shale.

i3 Energy PLC (AIM: I3E) Investor Presentation & Video

Eco, Atlantic) Oil & Gas Ltd. (AIM: ECO). has raised £19.5mln through an oversubscribed City fundraiser – cash to fund its exploration efforts in South Africa.

Through a stock placement and a retail sale, investors subscribed to shares at 30p (a small discount from last night’s closing). An existing shareholder Africa Oil Corp, (TSX-V.AOI) also subscribed to new equity.

Longboat Energy PLC (LON: LBE) announced a significant discovery in the Equinor operated Kveikje exploration well (35/10-8S) in licence PL293B (Company 10%).

The preliminary estimate of recoverable resources in Kveikje Main, being the primary target of the exploration well, is 28 to 48 MMboe (gross), above the pre-drill expectation.

The discovery has excellent reservoir quality and is close to existing infrastructure allowing for a simple development through multiple export options.

Arrow Exploration Corp (AIM: AXL) announced the spudding of its Rio Cravo Este-2 Colombian well. Marshall Abbott, the CEO of Arrow, gave shareholders a broad update on the company’s activities. He stated that it was an “exciting moment” for Arrow.

Victoria Oil & Gas PLC, (AIM: VOG), shares were suspended after the Arbitral Tribunal of the International Chamber of Commerce(ICC) ruled against the company’s subsidiary Gaz du Cameroun. The award was US$12.1mln.

Whilst GDC was awarded two of its counterclaims, and the Tribunal rejected RSM’s material claims on drilling costs, it has ruled against GDC for certain of RSM’s claims and has made an award totalling approximately US$12.1 million, with interest to be added. In addition, the Tribunal has directed the parties to confer regarding the proposed procedure for resolution of costs and attorney’s fees (“Costs”) with a target date for resolution by 30 June 2022.

In a stock market statement, the company stated that arbitration rules prohibit appeals and that awards must be paid immediately. However, GDC and Victoria Oil & Gas have not been able to pay the award.

Gazprom Germania, a Russian energy trading, storage, and transmission company, was abandoned by Gazprom Russia on Friday. It will now be transferred to Germany’s regulator in order to ensure energy security, Economy Minister Robert Habeck announced Monday.

Habeck stated that all voting rights in the company would be transferred to the Bundesnetzagentur.

Empyrean Energy PLC, (AIM: EME) stated that towing and anchoring operations in advance of the spudding of the LH 17-2-1 well at Jade prospect offshore China will begin on Wednesday (6 April 2022), and should take approximately four days.

It said that strict Covid protocols have been established, and two onshore bases are set up for helicopter-to-rig transfers. This will provide an alternative to any shutdowns.

Oilex Ltd (ASX:AIM: OEX) Cambay India Production Further Update. Oilex has been informed by the Gujarat Pollution Control Board (“GPCB”) that they have confirmed the revocation of the production halt concerning the Company’s Cambay field and have authorised the use of the Early Gas Production Facility (“EGPF”) on the Cambay C-73 wellsite. GPCB’s personnel will visit the C-73 wellsite to remove the production flange seal in the coming days.

Oilex’s Chief Executive Officer, Roland Wessel, said:

“Subject to the early removal of the production flange seal by GPCB personnel, production will re-commence immediately thereafter. The resumption of gas production and re-establishment of cashflow is an important milestone for Oilex’s Indian operations, and we look forward to contributing to India’s indigenous gas supplies.”

i3 Energy PLC (AIM: I3E) Record Corporate Production & Canada 2021 Reserves. Announced that the Company has achieved a record for corporate production as well as provided a 2021 year-end reserves report for its subsidiary i3 Energy Canada Ltd

  • Based on field estimates, i3 exited the first quarter of 2022 with a record weekly average production of approximately 20,312 boepd comprised of 61.1 million standard cubic feet of gas per day (“mmscfd”), 6,290 barrels per day (“bbl/d”) of natural gas liquids (“NGLs”), 3,522 bbl/d of oil and 316 boepd of gross overriding royalty interest production.
  • Current production continues to exceed expectations due to continual outperformance of the Company’s low decline production base, which has been further enhanced through strong drilling results via i3’s inaugural development drilling program.
  • Based on forward strip pricing at 31 March 2022, i3 now forecasts full-year 2022 net operating income (“NOI” = revenue minus royalties, opex, transportation and processing) of $192 million, a 28% increase over that predicted in the Company’s December 2021 capital budget announcement. This increase reflects the upward shift in commodity prices, in addition to well results that have bettered i3’s pre-drill forecasts.

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