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The Pay Zone: Oil Price, Ithaca Energy, IGas Energy, Sundry and Finally.......

Last updated: 12:40 31 Mar 2014 BST, First published: 11:40 31 Mar 2014 BST

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WTI $101.67 +39c, Brent $108.07 +24c, Diff $6.40 -15c, NG $4.49 -5c

Oil price

And still we stay range bound with few influences on the oil price and traders telling me that for choice they are bearish at the moment with refiners staying away from the market and supplies more than adequate. In the US we have some economic numbers due this week that might shed some light on whether the poor first quarter for the economy really was down to the cold weather. ISM and payroll data may show some signs that money saved at that time is now being launched into the economy and with today ending the quarter there will be some optimism with Easter in three weeks time.

Very little optimism for President Hollande though as the elections were a humiliation but it was the UMP not the FN that made sweeping gains and will lead to a serious cabinet reshuffle today.

Ithaca Energy (LON:IAE)

Ithaca has produced results today and with last year being very busy there has been much to announce. With the Valiant takeover there is inevitable difficulty comparison-wise but on the whole the numbers are good. Post-tax profits of $144.7m ($93.3m) produced EPS of 48 cents (36c) which was in line with expectations. On the production front they recorded 10,392 b/d up 120% y/y which generated cash flow of $244m (90) equal to 81 cents a share. Guidance for this year is 11-13/- b/d with the Greater Stella Area up and running at the end of the year. The guidance is a bit light due to a combination of technical problems and the ‘inclement’ weather causing problems in a couple of places and due to this it is also more second half weighted than I had been expecting.

I continue to believe that Ithaca is one of the soundest investments in the E&P space and I have had some run-ins with the company in the past, believe me! Provided the company does not fall into the trap of missing guidance on production figures then the next two or three years should be rewarding for shareholders as I see plenty of upside. I had hoped to attend the analysts meeting but wasn’t able to this morning, if I get the opportunity to see the management soon I will write more.

IGas Energy (LON:IGAS)

So, the Barton Moss well has been completed by IGas on time and below budget and despite the ‘non-operational’ issues, has demonstrated that the company has indeed got operational expertise. It is worth noting that the company also has expertise in the difficult to assess PR and local issues department, especially with protestors making life difficult on site. As to the results of the Irlam-1 well, it found coal as well as the Sabden and Bowland shale and a 400 foot core was taken which will now be analysed, a process that may take up to six months. Things are therefore progressing well in the North West with more seismic and the company is making steady progress in the East Midlands as well. IGas and its partners, (Egdon and Dart) who farmed-out of PEDL 139 and 140 to Total earlier this year have already completed the acquisition of 3D seismic and will now use it to assess drilling locations and satisfy all necessary environmental assessments. It should be noted that shooting all this seismic is not to find the shale but to satisfy the requirements of the process so that appropriate sites can be found and more importantly, flow tests can happen.

Completing Barton Moss is only part of the complex jigsaw that the process has become but it is an important one. Over the next few months there is another BGS survey to come, more seismic and before this time next year IGas and its partners will have drilled two more wells, one each in the North West and the East Midlands. Along with other groups operating in these shale prone areas there is going to be at least an idea of whether success might be achieved, if so they stand to make substantial gains across all the main players.

Sundry

Bowleven’s results showed that although very confident they company is still some way away from success in its key goals. The EA award from the Cameroon Government is still needed but the statement is confident, as it is that the fertiliser deal with Ferrostaal is close to signing. With the sanction for the initial phase of Etinde also imminent things are looking up for Bowleven and it may soon be time to take the sell recommendation off…

It’s Peter Voser’s last day at Shell today and proves the power of playing hard ball, he leaves with less of a reputation than he cultured during his time as CEO  and a big job for BvB to do as his replacement, ironically Shell looks as interesting as it has done for a long time, funny that…

I see in an article on Bloomberg that Rosneft may  be farming into Exxon’s acreage in Kurdistan…

Also spotted a  shareholder vote at Wessex to remove the board its a funny old world, what goes round…

And finally…

Talking about humiliation as I was at the top, England’s cricketers have finally for this winter embarrassed themselves with an abject, spineless performance against the Netherlands. Chasing only 115 they were bowled out for 88 runs which included only four fours and not one batsman took the opportunity to even show any grit. The collective, shocking, shambolic display is only what has been going on all winter with mollycoddled players (remember the 400 page dietary book of what the players should be given to eat whilst at other clubs and stadia?) dreadful coaches (one managed to remain an ‘elite’ coach, presumably for sacking the best player) and arrogant management who now expect fans to spend a hundred quid a ticket if not more to watch them play at home. PS the English women’s team have got through to the World Cup semi-final…

In the football Brendon Rogers reckons its all wrapped up as Chelski and the noisy neighbours have to visit Anfield, he may be right but… Well done to the Eagles who hired John Terry to score this weeks goal and the bottom of the table is looking very scary. Hammers v Maccams tonight…

Lewis Hamilton won in Malaysia driving the ‘best sewing machine I have ever driven’ in the Grand Prix sponsored by Silent Night…

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