As geopolitical tensions sent Brent crude above US$77 per barrel, the share prices of London’s oil super-majors rallied strongly to see new four-year highs.
BP PLC (LON:BP.) and Royal Dutch Shell PLC (LON:RDSB) both advanced more than 3%.
Earlier in the week, Shell unveiled a deal to sell its entire stake in Canadian Natural Resources for US$3.3bn.
Shell’s 97.56mln Canadian Natural Resources shares will be sold via an underwriting agreement with a group of brokers including Goldman Sachs & Co, RBC Capital Markets, Scotiabank and TD Securities.
On Thursday, Providence Resources PLC (LON:PVR) chief executive Tony O’Reilly, in the Irish oil explorer’s financial results statement for 2018, told investors that it was an “extremely busy” year, albeit, the most significant recent event came after the reporting period.
“During the year, we agreed 3 major exploration farm-out transactions which provided significant momentum to our portfolio development activities and also delivered incremental capital to enhance our financial resources,” O’Reilly said.
This April, meanwhile, saw Providence unveil a long awaited farm-out transaction which will see the Barryroe oil field advance towards development, with a proposed three-well appraisal drill programme and testing. In essence, the deal sets a roadmap to production from the field in Ireland’s Celtic Sea.
88 Energy Ltd (LON:88E) is only “a few short weeks away” from restarting operations at the Icewine-2 well, managing director Dave Wall told Proactive Investors.
Wall said the previously completed fracking programme had gone very well - in fact better-than-expected - however, the programme did run into some difficulties when it came to testing – and investors will be looking to the upcoming resumption and hoping for better results.
“We did get caught out in terms of timing,” the 88 Energy managing director said in an interview with Andrew Scott. “We ended up having to shut the well in for the cold arctic winter because we hadn’t finished flowing back the required amount of fluid that we needed to from the reservoir.
“Of course, this is fluid that we injected into the reservoir [through the fracking programme].
“The plan is, in early June, we will recommence the flow back, we’ll use nitrogen lift to accelerate the rate at which we can draw fluid from the reservoir and then hopefully - and all indications suggest that this should happen – we’ll get hydrocarbons flow.
“And what happens after that will depend on how high the rate of flow we can achieve.”
SDX Energy Inc (LON:SDX) followed the long weekend with not one but two updates from its busy drilling campaign.
In Morocco, it has revealed that the LMS-1 exploration well has unearthed a new conventional natural gas discovery within the 75% owned Lalla Mimouna permit, meanwhile, in Egypt, the company has started drilling the Kelvin-1X exploration well at the South Disouq project.
The LMS-1 well was drilled down to 1,158 metres to test a previously undrilled target reservoir, which was found to have 16.4 metres of net gas pay with an average porosity of 32% in an over-pressured section.
"We are very pleased with the results of this exploration well as it has significantly exceeded our pre-drill estimates for both reservoir quality and pay sand thickness,” said Paul Welch, SDX chief executive.
Echo Energy Plc (LON:ECHO) kicked off its new exploration drilling programme at the Fracción C asset, in Argentina.
Separately, on Friday, it clarified its position regarding the economic situation in Argentina which, at a cash level, could be argued to be a positive for the explorer. The company, in a statement, noted the increase in Argentina’s interest rate to 40% - which triggered a currency free-fall - and confirmed that it does not hold its cash in Argentinian Pesos.
It added that it has no borrowings linked to Argentinian Pesos either. Instead, the group’s policy is to hold all cash in either GBP, USD and Euros. Capital costs tied to the group’s ongoing Argentinian work programme are priced in USD and only converted to Pesos at the point of payment.
Similarly, the company said that its sales in the country are denominated in USD and are only converted to Pesos on receipt of funds.
“These receipts are used to pay local operating costs that are due in Pesos, and, as a result, the Company's exposure to the recent weakening of the Peso has been positive,” Echo said in the statement.