Share Talk Weekly Energy Sector News Round-Up, Saturday 14th May 2022

Four diplomats and officials stated on Friday that the European Union intends to continue a phased embargo against Russia this month, despite concerns about supply to eastern Europe. They also rejected suggestions of delay or watering down.

The biggest obstacle to an embargo agreement is the dependence on Russian oil in Bulgaria, the Czech Republic, Hungary, and Slovakia.

The proof is in the pudding, as they say, the world is watching and waiting, let’s see if the EU can remain united or will Putin achieve his goal by splitting the European Union member states?

U.S. energy companies added oil and natural gas drilling rigs for the eighth consecutive week. This was due to high prices and prompting by the federal government, drillers returned to the wellpad.

An energy services company, Baker Hughes Co reported that the oil and gas rig count, which is an indicator of future output, rose 9% to 714 in the week to May 13. This was its highest level since March 2020.

Malcy’s Blog – Oil price, President Energy, Empyrean Energy, Capricorn Energy & finally

Hydrogen Utopia International PLC (AQSE: HUI), has now confirmed that it has been in discussions with Powerhouse Energy Group PLC ( AIM: PHE) on a project opportunity in The Republic of Ireland.

HUI has been exploring the possibilities in the region since November 2021and is searching for a JV partner to develop a first of a kind waste to hydrogen facility. There is currently no agreement in place and the PHE Board is considering the proposal and how it may become involved in the potential project, which is at a very early stage.


Zephyr Energy PLC (AIM: ZPHR) Investor Presentation

UK Oil & Gas PLC (AIM: UKOG) announced that the North Sea Transition Authority (formerly the Oil and Gas Authority) has granted a one-year extension to the agreed Retention Area work programme of the Company’s operated PEDL137 licence (UKOG 85.635%) containing the producing Horse Hill oil field and its underlying Kimmeridge oil pool.

The extension grants an additional year in which to drill a second Horse Hill Kimmeridge well, with the commencement of drilling to be prior to 30th September 2023.

Still a well-followed stock, you think at these prices, one-day UKOG will have its day in the sun, one for the watch list for sure.

Germany claimed Russia was using energy as a weapon after Moscow cut natural gas supplies to retaliate for Europe’s sanctions over the war in Ukraine.

According to Robert Habeck, German Economy Minister, a unit of Gazprom was seized by Germany. Its deliveries were reduced by approximately 10 million cubic meters per day.

Although the move seems symbolic, it amounts to only 3% of Germany’s Russian gas imports according to Habeck. However, the Kremlin shows that it will not hesitate to squeeze its largest customer. The European benchmark gas price rose by more than 20%.

Malcy’s Blog – Oil price, Genel Energy, Touchstone Exploration, Predator Oil & Gas & finally

Drama at Thursday’s AGM saw Genel Energy PLC (LSE: GENL) shareholders empty the boardroom.

Chief Executive Bill Higgs cheered the company’s robust financial position and said management continues to review both “organic and inorganic opportunities”.

The oiler told investors it generated US$43mln of free cash flow in the first quarter of 2022, having received US$95mln of cash proceeds in the quarter from the Kurdistan Regional Government.

Here is the punchline; Chief executive Bill Higgs and non-executive directors Tim Bushell and Hassan Gozal did not receive the required 50% majority of votes in favour of re-election to their roles, and, as a result, were not reappointed as directors.

Touchstone Exploration Inc. (AIM: TXP; TSX: TXP)  reported US$10.49mln in petroleum sales for the first quarter of 2022. This is 28% more than the previous three-month period.

Quarter-on-quarter, Q1 produced an average of 1,396 barrels per day. This was up 4%.

Slowly, slowly, catch the monkey, totally under the radar, yet you get the feeling with the current uncertainty in the hydrocarbon space, a few oilers will make a move.

After a rise in shares of the oil producer, Saudi Aramco was able to surpass Apple as the world’s largest company. It is now worth more than $2.4 trillion.

After its share price fell 5.2% Wednesday due to a slump in technology stocks, Apple’s stock market capitalization dropped to $2.37 trillion.

Clontarf Energy plc (AIM: CLON), updates shareholders on the drilling of the Sasanof-1 exploration well and will issue further updates upon the completion of campaign milestones:

Valaris MS-1 rig is anchored in the Dampier outer harbour (North Western Australia) and is scheduled to commence tow to the Sasanof-1 location on 16 May 2022. The Operator’s (Western Gas) drilling operations team have been deployed to the field and are now onboard the MS-1 rig undertaking pre-mobilisation checks.

Malcy’s Blog – Flash blog, Zephyr Energy, i3 Energy & Harbour Energy

Predator O&G Hldgs (LON: PRD) Operations Update and Directorate Changes.

2022 Moroccan drilling programme the sources of long lead drilling inventory have been identified and purchase orders are being issued to secure critical items, including four wellheads, to enable the drilling programme to commence at the earliest opportunity.

Lease Operators Ltd. (“LOL”) has applied for a Certificate of Environmental Clearance (“CEC”) from the Environmental Management Authority in Trinidad for CO2 EOR operations using some data and an example template provided by the Company. The award of the CEC is expected shortly.

The Company attended Ireland’s National Energy Summit on 26th April 2022 at Croke Park Dublin in its capacity as a gold sponsor. Read More

Zephyr Energy plc (AIM: ZPHR) provided an update on first-quarter 2022 (“Q1”) hydrocarbon sales from its non-operated asset portfolio in the Williston Basin, North Dakota, U.S.

Q1 sales from the Company’s Williston Basin portfolio averaged circa 1,600 barrels of oil equivalent per day (“boepd”) net to Zephyr, up from 548 boepd in Q4 2021.

During the quarter, Zephyr sold 144,540 barrels of oil equivalent (“boe”), and net sales to Zephyr were as follows

Should be an exciting year for holders with the company laying out the financial, and technical road map for the 2022 campaign.

i3 Energy PLC (AIM: I3E) Dividend Increase & June 2022 Dividend Declaration, is a company that keeps gaining momentum and going from strength to strength in delivering shareholder value.

The company announced that due to the ongoing exceptional performance of its production assets, positive results from the initial phase of its 2022 development drilling programme, and continuing commodity price strength and the resultant positive impact on our cash flow projections, the Company has decided to increase the minimum dividend to be paid in 2022 by 25% from £11.827mm to £14.784mm. The increase will be implemented by increasing the monthly dividend.

Angus Energy Plc (AIM: ANGS) Wet commissioning is expected to begin at or around 18 May and is assisted in this by an experienced team led by OSL and Inspec. ANGS continue to aim for a short wet commissioning programme and a target date of First Gas of 1 June.

This would allow for one full month of production at current high spot prices before the Company’s obligations to deliver volumes at the hedge price commence at the end of June.

As the Tweet states, is within touching distance of finally delivering, it has been a long road, board changes, yet Brockham Oil Field is back on the menu, Saltfleetby news June, the company comms are second to none on social media, things are looking positive, surely this must be on your list folks?

Empyrean Energy PLC (AIM: EME) Capital raising, further post drill analysis, Mako gas and debt restructure news landed this week.  Those who read last week’s blog would have read my comment.

“Looking at this logically, they would need around £10m to £15m to drill Topaz, but could raise these via a JV partner or sale of Mako gas asset, whatever they chose to do, it is not over yet folks. One for the watchlist.”

This week the company announced a capital raising, debt restructure and preliminary regional oil charge analysis and its implication for Topaz prospect at its 100% owned Block 29/11 permit, offshore China.

£1.83m raised at a price of 1.5p per share and a convertible Loan Note debt restructured.

The funds raised from the Subscription will be used to complete further post well analysis of the Jade well, satisfy any further costs associated with the Jade drill, conduct a comprehensive oil migration study in conjunction with CNOOC for potential oil charge to the Topaz prospect, and for the Company’s general working capital requirements.

At that stage, a final decision to enter the second phase of exploration is likely to be made and further announcements will be made in due course.

The show goes on, folk, we watch to see how this unfolds.

The EU backs down again: Brussels has dropped the proposed ban on EU tankers carrying Russian oil. Splits forced the bloc to relax its recent package of economic sanctions targeting Moscow.

The splits have thwarted attempts by the European Commission to create a sixth tranche to prevent Russia from funding its invasion of Ukraine. These measures include the shipping ban and blockade on Russian oil imports.

Officials were forced to scrap plans for rules that would have prohibited European tankers from transporting Russian crude oil anywhere on the planet after intense lobbying from Greece, Malta, and Cyprus.

Malcy’s Blog – Flash blog, Genel Energy, Scirocco Energy & Longboat Energy

Mosman Oil and Gas Limited (AIM: MSMN) announces a £1.1 million conditional placing to fund the drilling of the first re-development well in the Challenger Project in Texas, of which Mosman has a 97% working interest.

If the targeted production rates are achieved, Mosman Net Production could increase 88% from 130 boepd (as reported for the quarter ending March 31, 2022) to circa 245 boepd.

San Leon Energy PLC (AIM: SLE) Update on the development of the Oza field, Nigeria.

San Leon, the independent oil and gas production, development and exploration company focused on Nigeria, notes the announcement made yesterday by Decklar Resources Inc. (“Decklar”) in Canada. San Leon has an 11.5% shareholding in Decklar Petroleum Limited (“DPL”), the local subsidiary of Decklar operating in Nigeria, and has also made a US$5.5 million loan to DPL, via 10% per annum unsecured subordinated loan notes.

88 Energy Limited (ASX, AIM: 88E) Report that the third-party (Jordan & Pay) evaluation of the Shelf Margin Delta, Slope Fan Set and Basin Floor Fan play fairways on its Project Icewine acreage is now complete.

The independent third-party mapping, which utilised available well information from presentations publicly released by neighbouring acreage holders, Pantheon Resources (AIM: PANR), plus internal 88E data, shows that all Pantheon reservoir units extend onto the Project Icewine acreage.

In-depth petrophysical re-evaluation of Icewine-1 and broader Icewine East acreage has been completed, with the results indicating comparable, or better, reservoir quality in some reservoir units relative to those of Pantheon’s tested intervals which flowed oil.

Tower Resources PLC (AIM: TRP) provided an update on activity in respect of its Thali Production Sharing Contract (PSC), in the Rio Del Rey sedimentary basin offshore Cameroon.

The Minister of Mines, Industry and Technological Development (MINMIDT) has, with the support of the President of the Republic, agreed to grant a further extension of the First Exploration Period of the Thali PSC to 11 May 2023.

Tower is also pleased to announce that it expects to complete shortly a letter of intent (LOI) with Shelf Drilling to cover the drilling and testing of the NJOM-3 well in the fourth quarter of 2022, using the Shelf Drilling Trident VIII jack-up drilling unit.

Clontarf Energy PLC (AIM: CLON) Acquisition of 10% of Sasanof Prospect, Offshore Western Australia.

Acquired a 10% interest in the high-impact multi-TCF (Trillion Cubic Feet) Sasanof exploration prospect (located mainly within Exploration Permit WA-519-P ) through the acquisition of a 10% interest in Western Gas (519 P) Pty Ltd (“WG519P”), which wholly owns the prospect (the “Acquisition”);

Plans to drill the main target horizon (the “Sasanof-1 Well”) in this prospect during May/June 2022

The 10% interest is being acquired from Western Gas, which will hold 52.5% in the WG519P following the Acquisition. The other partners in the licence include Global Oil and Gas Limited (25.0%) and Prominence Energy Ltd (12.5%).

i3 Energy plc (AIM: I3E) Q1 2022 Operational and Financial Update and Expanded Capital Programme.

  • Q1 2022 average production of approximately 18,095 barrels of oil equivalent per day (“boepd”), representing a 100% increase over Q1 2021
  • Canadian Capital budget to increase by up to $50 million above the previously announced $47 million 2022 programme (together, the “Enlarged Capital Budget”), focused on continued low-risk, high-return development drilling of i3’s core Glauconite and Cardium fairways, with expanded Montney and Clearwater programmes
  • Full-year 2022 net operating income ( “NOI” = revenue minus royalties, opex, transportation and processing) is now forecast to be $241million for 2022 assuming the full implementation of the Company’s Enlarged Capital Budget
  • Monthly dividend payments of £1.1827 million commenced in March with year-to-date distributions totalling £3.55 million; a dividend increase is expected to be announced in due course

We close with Union Jack Oil plc (AIM: UJO) as you can see from the Tweet published on the 8th of May, l am expecting an update as soon as Monday onwards with the company publishing their full-year results.

Highlighted UJO a few times, unloved right now, but let the numbers do the talking.  A $6million net revenue announcement update from the Wressle producing development is also expected, not forgetting this is onshore, and all planning permission is in place, this well will continue to follow revenue into the foreseeable future.

Maybe a good call for the future would be for the company to pipe the crude directly into the main pipeline infastucture if possible, one for the bulletin boards warriors to chew the fat over.

Open comms of paying dividends to shareholders in the near future. Mkt cap is still only £29:87m, as the cash value of the company continues to rise, you do the maths, one day Rodders

Author @ABMckinley

The opinions expressed here are those of the author

Disclaimer: This blog is provided for general information and It does not constitute investment advice, not buy or sell shares, warrants or bonds in any companies written about within the blog. Information is taken from publicly available sources and any comment is that of the author.

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