WTI $54.50 +$1.96, Brent $58.53 +$1.15, Diff -$4.03 -81c, NG $2.12 -1c
A decent rise on Friday after the IEA report was not as bearish as it might have been. With an upwards revision for 2019 demand and a cut, albeit modest, in the Non-Opec supply, the call on Opec crude stays above 30m b/d at 30.7 and 30.2 in the 3rd and 4th quarters of this year respectively after which dont ask…
An update from Trinidad this morning where well workover operations at AT-4 and AT-5X have started to survey downhole conditions to ensure that no obstacle will prevent Predator’s s preferred downhole completion design from being installed across the Herrera sand interval chosen for the first injectivity and production test. These are the wells chosen for the initial pilot CO2 EOR programme and ‘clears the way for the next stage of the CO2 project to begin’.
CEO Paul Griffiths also says in the announcement that ‘simultaneously we are accelerating our plans to drill in Morocco and expect to conclude an option on a rig in the near future’. The company has been working hard on the Morocco licence and has great enthusiasm for it, viz ‘We are looking forward to a very busy and exciting period of sustained operations over the next 6 months with Morocco potentially offering a transformational opportunity for near-term value creation for our shareholders’. All in all PRD are beginning to look like a most interesting play in the sector over the next few months.
The partners have announced this morning that they have made a major oil discovery offshore Guyana at the Jethro-1 well. The well proves 55 metres of Net High Quality Pay on the Orinduik Block in the Lower Tertiary sandstone reservoir and confirms multiple prospects up-dip of recent discoveries notably by Exxon in the Stabroek Block.
This is a substantial discovery made more important by the high value nature of the barrels it will produce and in a stroke de-risks a lot if not all of the Orinduik Block. The fact that it way exceeded pre-drill estimates does credit to the high quality seismic and the development should be simply done with little appraisal and low cost wells. The Block has 2.5bn barrels of gross unrisked resources and with this find the valuation will be impacted for both these quoted companies, just think what might happen if the Cretaceous can be proved up? This field could be 20km² and with 55m of pay could be huge, those pre-drill estimates of 100m or even 200m might end up being conservative.
The Tullow conference call was extremely informative, with few worries about oil/gas mix and porosity and whilst the oil samples are on the way to the lab the way they flowed was clearly encouraging. With 90% net to gross and the oil/water contact plenty deep enough the partners really have hit the jackpot here. And remember that Total farmed-out to Qatar Petroleum before the result was known making both those parties, amongst many others, looking for a bigger piece of this latest oil hotspot…
The share price movements this morning have been, as expected, very positive but £250m on Tullow’s market cap and £1oom +on Eco’s is only part of the story. The rig moves off to drill the Joe prospect which whilst a separate play type can only have been materially de-risked by this result. For Eco it is a validation of their strategy and also for Tullow to whom this has been something big and will also go on to be a company changer. There is a long way to go yet for these companies but for Eco in particular it is a success of the most spectacular nature and at 124p the shares still have considerable upside from here.
A brief update from West Newton where the operator has announced that the rig has been mobilised on the A-2 well which signals the start of 4-8 weeks of testing. They also announce that permissions are in place for the West Newton B site and for drilling and testing two wells in that location.
Briefly, no great surprises in the weekends footy with the Noisy Neighbours tucking a few away and Liverpool doing the same, whilst Sours and the Gooners both won it maybe the win by the Red Devils against Chelski that is the most interesting.
With the RWC only a few weeks away the warm-up games are under way and yesterday, Wales, unbeaten in 14 games and about to be crowned No 1 in the world after the All Blacks lost on Saturday unfortunately lost at Twickenham.
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Eco (Atlantic) Oil & Gas (ECO) has released their results for Q2 2019 which featured a major oil discovery on its Orinduik license in Guyana and solid financials, including over £21 million in cash and cash equivalents.
SP Angel research note on commodities and miners, featuring: Bluejay Mining (JAY LN) 7.3p, Mkt cap £63m – Hudson’s White Mountain Anorthosite mine starts production this week in Greenland Hudson Resources (HUD CN) C$0.38/s, Mkt cap 68m Hummingbird Resources (HUM LN) 22.0p, Mkt Cap £77.8m – Interim results Katoro Gold (KAT LN) – Disposing of its Tanzanian gold projects Prospect Resources (PSC AU) – Power supply agreement for Arcadia
America’s biggest toymaker is to buy London-listed Entertainment One, A US House of Representatives committee has asked e-cigarette manufacturers to hand over details about the health impact of products, heaping renewed scrutiny on the popular devices
More waste could be sent to landfill in the UK after a no-deal Brexit, a major waste company has said. There are worries a no-deal outcome will disrupt the export of millions of tonnes of waste to facilities in the EU, so it will have to go to landfill.
The program was first launched in Mexico City in 2008 - using Symphony's plastic technology, Mexican-based Grupo Bimbo, the largest global baking company, tackles waste management with a clear mission: to make all packaging recyclable, biodegradable or compostable by 2025.
Predator Oil & Gas provide a progress update on its CO2 EOR project in Trinidad. Galileo Resources discuss the final technical report and inferred mineral resource estimate for its Star Zinc Project. Chris Bailey covers Rank Group, Antofagasta & CRH Plc
SP Angel research note on commodities and miners, featuring: Altus Strategies* (ALS LN) 4.8p, Mkt Cap £8.5m – Proposed JV on Lakanfla and Tabakorole in Mali Anglo Asian Mining* (AAZ LN) 149.5p, Mkt Cap £171m – Comment regarding media article Ariana Resources (AAU LN) 2.175p, Mkt Cap £23.0m –Salinbas drilling and licence update Aston Bay Holdings* (BAY CN) $0.065, Mkt cap C$7.6m – Soil sampling underway at Buckingham Gold project in Virginia, USA KEFI Minerals* (KEFI LN) 1.0p, Mkt Cap £7.0m – Appointment of NED Rambler Metals & Mining* (RMM LN) 0.075p, mkt cap £12.3m – Lombard Odier convertible loan closes
Chairman Dr. Clifford Gross believes such growth was attained through the company’s “unique approach of acquiring and commercialising university IP innovations, coupled with providing a range of IP services continues to deliver strong returns on invested capital.”