Headlines
• In Brief:
TomCo Energy*** (LON:TOM – 0.15p) – (BUY – 0.49p) – A New String to the Bow
Cairn Energy (LON:CNE – 211p) – Appraisal Improves Potential
EnQuest (LON:ENQ – 36p/SK4.37) – Good Update – Cash the Key Measure
In Brief
• TomCo Energy*** (LON:TOM – 0.15p) – (BUY – 0.49p) – A New String to the Bow: Today's news is a reflection of the fact that the key driver to progressing the eco-shield process is the demonstration or commerciality by Red Leaf, and that the changes to the board are a reflection of this fact. In the near term, however, we will await further news able before assessing the value of this new revenue stream may have to the Company. Given the fact that the cost base now appears to have been stabilised, we are reiterating our buy recommendation and XXp target price.
• Cairn Energy (LON:CNE – 211p) – Appraisal Improves Potential: Completion of phase 2 of appraisal programme appear to confirm the presence of a world-class discovery in Senegal. Well there is still further work to be done, the next stage (we believe) should be completed relatively quickly and an opinion on commerciality forthcoming in the next 10 months. Once this is been completed, we would expect the Company to work quickly towards the "final investment decision" stage before starting the development planning. Assuming all things the right in the timing, we believe that this field could be on stream as early as 2021, given the capacity in the system currently.
• EnQuest (LON:ENQ – 36p/SK4.37) – Good Update – Cash the Key Measure: Today's update provides a timely reminder of the progress that the Company in the last few years. It is also a testament to the quality of the management team that it has been able to keep its developments on track, despite the headwinds provided by the oil price environment. While we would always remind people that a true test of the Company successes the amount of cash it generates from its operations, and we will have to wait until the results for this to be tested, we believe that the Company's owners should be pleased with the progress that their management team has made thus far.