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SP Angel Morning Oil & Gas Solo Oil, Urals Energy and Rex International

Published: 11:47 18 Mar 2015 GMT

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News Items 

Rex International – Gemini Needs a Twin, but as One Door Closes, Another Opens

Yesterday’s news that the last well in its Norwegian programme was not sufficiently deep to intersect the horizons highlighted by RVD as highly prospective, is frustrating to management and investors alike.

While we have increased our risks and investment horizon associated with this well (CoS 15% Vs 24% previously, development 2020 Vs 2018), the results of this well have not precipitated its elimination from our unrisked valuation, but the increased risking means that it does not contribute to our risked valuation.

As one door closes, however, another opens, and contemporaneously with the release of the disappointing news on Gemini, the Company has been able to disclose that it has secured a 30% working interest in the Rolvsnes discovery, which will be appraised in 2H’15.

The elimination of Gemini from our risk adjusted valuation has been more than offset by the consolidation of Rolvsnes’ risked valuation. As such, we are adjusting our Target Price to S$0.89 and maintaining our BUY Recommendation.

Solo Oil (LON:SOLO) Horse Hill at a Trot

Today's update about the horse hill asset should lift the Company's investors, not least because of the fact that the investment in the asset has generated real value. Of course the unwritten statement lies in the fact that the Kimmeridge and Lias intervals are showing exceptionally high TOCs, which raises the prospect of the fact that they are excellent candidates for self-sourcing reservoirs.

Today's news opens up the possibility of further upgrades to the as yet unchanged predrill prospective resources estimates, which could really open not only the Horse Hill play, but the prospectivity of the wider Weald basin shale play.

Urals Energy (LON:UEN) – Operating Issues… Its Better than You Think!

Today's update is refreshing in that the Company has not had to mention a legal case, outstanding debt or other non-operational issue that it has had to contend with. In that respect, that they have to operate their topping unit manually is almost not worth worrying about.

The one concerning bit of news, however, is the collapse of the Petrosakh 112 well, which has been on line for a number of years, and given the well stock, we are concerned that the issue may not be localised to the 112 well alone.

Investors should be pleased with the progress that their management team are making, but in essence, this is only offsetting the dual headwinds of Russian geopolitical risk and the current oil price environment.

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