A fairly busy week on the oil and gas front.
Sound Energy PLC (LON:SOU) raked in more than it anticipated in a fundraiser that allowed private investors to participate alongside City institutions.
Demand was so strong the company’s advisers had to issue more shares than they were planning, meaning the process generated £26.9mln. Sound was looking for £24.1mln.
The cash will be used to develop the Tendrara licence in Morocco, where the results from its two gas wells have exceeded expectations.
Yesterday, Sound had said its first horizontal well flowed at 32mln standard cubic feet of gas a day and could eventually go “significantly above” 40mln standard cubic feet.
To put that into context, Sound told analysts and investors ahead of its first ever well on Tendrara that 3.5mln standard cubic feet of gas would be commercial.
Elsewhere, Ithaca Energy Plc (LON:IAE; CVE:IAE) told investors on Friday that the Stella field start-up been delayed due to problems found on the floating production facility.
Routine inspections uncovered a number of faults on a number of electrical junction boxes on the vessel's processing facilities, and a programme of repairs is now underway.
Stella’s ‘first oil’ was slated for the end of November, but the company says start up is now anticipated in early January.
SDX Energy Inc’s (LON:SDX, CVE:SDX) latest quarterly results provided further evidence that the Egypt-focused petroleum firm has weathered the worst of the storm.
Thanks to a quality asset base comprising low-cost production it has been able to keep tight grip on its operations and, crucially, being debt free kept the group away from the perils that befell Egypt peers such as Petroceltic and Circle Oil in 2016.
“We couldn’t control oil prices but we could control costs,” chief executive Paul Welch told Proactive Investors.
“We could keep costs down, at less than US$10 a barrel, and so that meant even in the low, low price environment seen in February we were still cash-flow positive at asset level.
Welch added: “We were cashflow positive, we didn’t have any debt. We were much stronger into this downturn than perhaps some other companies were.”
Meanwhile, Union Jack Oil PLC (LON:UJO) has completed its deal to acquire an extra 3.34% of the Wressle field from Europa Oil & Gas Holdings Plc (LON:EOG).
Subsequently Europa retains 30% of Wressle, and UJO’s interest in the project rises to 11.67%.
UJO paid £600,000 to acquire the additional interest, and the deal values its whole stake at around £2mln.
Wressle is expected to come online in early 2017 at a predicted rate of 500 barrels of oil per day, and Europa’s 500 bopd share would more than double group production.
Finally, TomCo Energy Plc (LON:TOM) told investors that it will turn its focus to its shale oil assets in Utah after it was unable to secure the necessary financing for its proposed Makarie palm oil project in Sierra Leone.
TomCo has decided to suspend the project while it takes stock of its options, although it will continue to assess the feasibility of raising the required capital.
The company had been hopeful of securing the finance as recently as last month.