VSA Morning Flow Test, 01/04/20
Columbus Energy Resources (LON:CERP)
Columbus Energy Resources’ (LON:CERP), joint venture partner, Predator Oil & Gas Limited (LON:PRD) has provided an update regarding the Inniss-Trinity CO2 pilot project. CO2 injection into AT-5X is progressing, as part of the second phase of the pilot project with early results indicating downhole pressure build up, which is positive for future extraction. As part of this second phase of injection, PRD is currently looking towards continuous injection of CO2 whilst working under the revised coronavirus related HSE protocols. Approval processes are now being worked on to enable PRD to increase the volume of CO2 supply whilst utilising existing equipment that is located in Trinidad.
Although commodity prices have weakened substantially during previous weeks PRD believes the low capital cost project remains value accretive at US$20/bbl. The update from PRD provides confirmation of the positive potential of the asset and the consequent benefit to CERP.
We reiterate our Buy recommendation and target price of 21.6p/sh.