A fairly busy week for the small cap energy sector and it ended with oil gas producer Victoria Oil & Gas plc (LON:VOG) reporting a record month for gas sales from its Logbaba field in January as a new pipeline to Bonaberi came on-stream.
Three new customers began taking gas during December after the Bonaberi extension.
This new supply and increased consumption from state energy company ENEO as the dry season starts had a beneficial impact in January, said Victoria.
“GDC [its local subsidiary] has set a record in monthly supply figures averaging 14.5mmscf/d and peaking at 17.1mmscf/d up to 31 January.”
Bonaberi is an industrial part of Douala, Cameroon’s second city.
Elsewhere, Green Dragon Gas Ltd (LON:GDG) said this week it was investigating a dual-listing in China to get access to additional capital to develop its portfolio of coal bed methane gas fields.
Talks are already underway with a range of Chinese financial institutions over re-financing US dollar-denominated debt with renminbi debt.
Randeep Grewal, chairman, said there was a better understanding of the potential in Chinese CBM energy in local financial markets.
“While we do not expect to issue any new shares, we hope this will help narrow the discount to our asset value and deliver increased value to all shareholders.”
A decision on whether to dual list will be announced with the annual results, he said.
Premier Oil PLC (LON:PMO) announced the terms of a refinancing that promises to remove uncertainty for investors.
The company says it has preserved headroom of its prior facilities and all maturity dates are now being aligned to May 31, 2021.
"The agreement of the long form term sheet with representatives of our private lenders marks a significant milestone for Premier,” said Tony Durrant, Premier Oil chief executive.
“We are grateful for our lenders' continued support, which reflects the high quality nature of our asset base, the strong recent operating performance and our plans to deliver value for all of our stakeholders."
Premier Oil highlighted that it is producing at a rate of 80,000 barrels oil equivalent per day and it anticipates a significant step-up in output when the Catcher field comes online later this year – and that will materially enhance cash flow.
Plexus Holdings PLC (LON:POS) has extended its contract with Shell Brunei (BSP) for its POS-GRIP wellhead technology.
The extension covers the supply of both High Pressure/High Temperature and standard pressured Wellhead and Mudline systems and services and is the fourth contract signed between the companies under a 2012 framework agreement. Plexus has worked with BSP since 2006.
The day before announcing this news, the firm said in an update it had been bit by the downturn in oil exploration.
Revenue for the current year to June is running materially behind expectations, though talks are underway over contracts that may claw back some of the shortfall.
Plexus added it had already mitigated some of the potential problems through cost cutting, so the increase in losses will be less proportionate. Cash is also being conserved.
More encouragingly, Plexus has noted an uptick in activity in the oil and gas industry and sees the second half of the current financial year as the bottom of the exploration drilling down cycle, especially in the North Sea.
In analyst news, City broker Cantor repeated a ‘buy’ recommendation this week on Eland Oil & Gas PLC (LON:ELA) as the company restarts production at the Opuama field in Nigeria.
With a 149p price target Cantor sees more than 200% upside to Eland’s current price of 47.64p.
“We continue to be encouraged by Eland’s continued operational progress against the backdrop of challenging civil conditions in Nigeria,” said Cantor analyst Sam Wahab.
Eland has now begun production at Opuama. It has now finalised the implementation of crude export via a shipping solution, rather than problematic pipelines, and production into the main storage vessel is underway.
A shuttle vessel will shortly arrive on site to begin transporting crude.