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Views from the Trading Floor - Featuring Gulf Keystone, San Leon and Ortac Resources

Published: 16:33 15 Mar 2012 GMT

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Saints & Sinners 

  

Oil & Gas 

(For the watch list)

Borders & Southern (LON:BOR) Drilling update due

Xtract Energy (LON:XTR) Drilling update due

Xcite Energy (LON:XEL) Phase 1A of the First Phase Development of the Bentley field, potential updates due.

Gulf Keystone (LON:GKP) pushed 2% higher after the company said “the English Commercial Court in London ordered Excalibur Ventures LLC ("Excalibur") to make a payment of GBP6,000,000 into Court within 21 days as security for the costs of Gulf Keystone and two of its subsidiaries (the "Companies") of defending the legal action commenced by Excalibur in December 2010. The English Commercial Court also ordered Excalibur to make a payment of GBP3,500,000 into Court within 21 days as security for the costs of Texas Keystone Inc. In addition, Excalibur was ordered to pay costs o f the 14 March 2012 hearing to the Companies and Texas Keystone Inc. and is required to make interim payments of GBP110,000 to the Companies and GBP60,000 to Texas Keystone Inc. within 21 days. As announced by the Company on 26 July 2011, October 2012 has been set as a date for a trial in the English Commercial Court of all the claims asserted by Excalibur. The Companies continue vigorously to dispute and contest the allegations and claims asserted by Excalibur.”

Serica Energy (LON:SQZ) jumped 7% to 31.5p on almost 4 times the average daily volume after the company said “subject to the consent of the Ministry of Mines and Energy in Namibia, BP will be joining Serica in the exploration of Licence 0047 offshore Namibia by farming-in to Serica's interest. The Licence, comprising Blocks 2512A, 2513A, 2513B and 2612A (part), was recently awarded to Serica Energy Namibia B.V. (a wholly owned subsidiary of Serica) and covers an area of approximately 17,400 square kilometres in the deep water central Luderitz Basin. Serica currently has an 85% interest in the blocks. Its partners are the National Petroleum Corporation of Namibia (Pty) Limited ("NAMCOR") (10%) and Indigenous Energy (Pty) Limited ("IEPL") (5%). Both NAMCOR's and IEPL's interests are carried by Serica for prescribed work programmes. Under the transaction, BP will pay to Serica a sum covering Serica's past costs and earn a 30% interest in the Licence by meeting the full cost of an extensive 3D seismic survey. As a result of the farm-out, Serica's interest in the Licence following completion of the seismic survey will be 55%. Serica has also announced today that it has signed a contract with Polarcus Seismic Limited to acquire up to 4,150 square kilometres of 3D seismic across the Licence (see separate announcement). 

Providence Resources (LON:PVR) jumped 12% to 482p after the company said “that light crude oil at its first well in a large offshore Ireland drilling campaign flowed at almost double the rate it had previously expected, more than likely making it a commercial discovery and increasing the confidence in its prospects. The Barryroe well flowed a very high-quality light crude at 3,514 barrels of oil a day along with 2.93 million cubic feet of gas a day, beating its commerciality target of 1,800 barrels a day. The high flow rate and good quality of the oil make it likely that t he field will become the first commercial discovery offshore Ireland.”

On the back of the Providence Resources update, San Leon Energy (LON:SLE) traded as high as 13.25p. San Leon announced, on 23 December 2011, that the Company has assigned its 30% working interest in Standard Exploration Licence 1/11 to Providence in exchange for a 4.5% NPI on the full field. San Leon Energy will not pay any further appraisal or development costs on the Licence and is not paying any costs towards the 48/24-10 well.

Lansdowne Oil & Gas (LON:LOGP) added another 4p (+7%) on the back of the Barryroe update from PVR, as Lansdowne has a 20% interest in the asset.

Gold Oil (LON:GOO) jumped 8.6% to 4.1p on huge volume of almost 20 million shares after the company said it has now completed the processing and interpretation of the 3D marine seismic Erika North and South surveys on Block Z34 offshore Talara Basin, Peru. Receives Competent Person's Report from DeGolyer and MacNaughton for 12 prospects identified by Gold Oil on the block. Mean prospective resources certified by DeGolyer and MacNaughton total a combined 2.02 billion barrels of oil with a mean potential net present value of $ 2.6 billion. Farm out process is progressing wel l with the data room open and available to prospective partners from early February. Considerable interest in the opportunity has been shown by a large number of oil companies and in order to accommodate the level of interest, the bid deadline has been extended to early May.

Petrel Resources (LON:PET) started to get active once again, pushing 12% to 8.5p on decent volume. The company have been very quiet over the last few months and have not updated the market since the 17th of October last year. We will be watching the news wires for any updates.

Mining

Ortac Resources (LON:OTC) pushed 5% to 0.94p on decent volume of nearly 14 million shares. Possibly one of the reasons behind the move could be a report published last night from Graeme Dickson, a broker at Optiva Securities on the subscription email service for This is Money web site that spoke favourably of the company. The report can be seen here https://www.thisismoney.co.uk/money/midasextra/article-2114869/European-gold-explore r-share-price-multiply-obtain-permission-start-production-sites.html#ixzz1p8TGJ6Vr 

ENK Plc. (LON:ENK) pushed 3% to 12.5p during trading today after the company reported the completion of the infill drilling program and nickel limonite and saprolite resource update for the Acoje Project as well as an update on the nickel laterite infill drill program for the Zambales Chromite Mining Corporation Project. Updated Indicated and Inferred JORC (2004) Resource estimate at a 0.8% Ni cut-off for Acoje, as prepared by Snowden Industry Mining Consultants is Indicated: 40.9 million tons grading 1.08% Ni, 0.05% Co. Inferred: 29.0 million tons grading 0.96% Ni, 0.06% Co. Representing a total of over 720,000 tons of contained nickel at the Acoje Project alone. Both projects are located in close proximity on the west coast of Luzon, 250 kilometers north of Manila in the Philippines. 

Orogen Gold (LON:ORE) jumped 17% to 0.78p on huge volume of nearly 40 million shares. The market did not like the last operational update back on the 27th of February, and promptly sold the stock down. Possibly one of the reasons for the bullish move could be this little snippet from the last update "We will continue to update shareholders as work progresses and when we receive assay results from the underground sampling programme shortly." Could the market be in store for the assay results?

Conroy Gold & Natural Resources (LON:CGNR) slipped 18% to 2.25p on almost 3 times the average daily volume. We will be watching the news wires closely for any updates or comments that materialise regarding the move.

From the trading floor

The FTSE 100 was trading 20 points easier at 5926 (-0.32%) on volumes of 680 million shares by the time the US bell had sounded for the open. The markets were all shaken a little by the news that the Fitch Ratings Agency had placed the UK on negative outlook. The FTSE AIM All-Share index was 0.15% easier on volume of just over 1 billion shares.

Commodities Corner 

Gold – ↑Trading at $1648, up $5 (+0.31%) 

Silver – ↑Trading at $32.24, up 37c (+0.36%) 

Copper – ↑Trading at $8526, up $54 (+0.65%) 

Zinc – ↑Trading at $2082, up $17 (+0.45%) 

WTI Crude – ↓Trading at $105.11, down 29c (-0.28%) 

Brent Crude – ↓Trading at $123.13, down $1.84 (-1.47%) 

 

Any questions please don’t hesitate to contact me at steve.a sfour@fox-davies.com

Written by Steven Asfour, Sales Trader at Fox-Davies

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