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Oil price, BPC, Rockhopper, Eco, Angus. And finally…

What with the US holidays at the end of the week crude drifted on Friday but the week was a good one, WTI was up $3.11 and Brent rose $3.22, impressive performances ahead of today’s Opec+ meeting. With the cartel expected to extend the 2m b/d cut pretty much expected I suspect that the market might think that all the good news is in the price in the short term.

Navitas - Oil price, BPC, Rockhopper, Eco, Angus. And finally…

WTI $45.53 -18c, Brent $48.18 -43c, Diff -$2.65 +56c, NG $2.84 -12c

Oil price

What with the US holidays at the end of the week crude drifted on Friday but the week was a good one, WTI was up $3.11 and Brent rose $3.22, impressive performances ahead of today’s Opec+ meeting. With the cartel expected to extend the 2m b/d cut pretty much expected I suspect that the market might think that all the good news is in the price in the short term.

It is not as if Opec+ can’t give an unpleasant surprise and with escalation in tension in the Middle East, with the assassination of the Iranian nuclear programme head followed by an alleged attack on an oil refinery in Northern Iraq claimed by Iran a deal has much to get through.

Bahamas Petroleum

BPC has signed the Goudron EPSC in Trinidad and will issue 36m new shares as expected as the new contract replaces the existing one due to expire at the end of 2020. The terms of the EPSC are ‘largely consistent’ with the terms that previously prevailed under the existing Goudron Production Sharing Contract and production from Goudron currently accounts for approximately 40% of BPC’s baseline daily production in Trinidad and Tobago.

Rockhopper Exploration

RKH has announced that the Sea Lion farm-in by Navitas is still on and following the announcement of the proposed merger of Premier and Chrysaor, Navitas has confirmed that it remains committed to the proposed farm-in.

In order to enable the merger to complete and the new management of the combined entity to make a firm decision on the Sea Lion project, Rockhopper, Premier and Navitas have ‘agreed to extend the exclusivity period for the farm-in to the earlier of (i) 30 September 2021; (ii) the execution of definitive transaction documents, or (iii) a decision by Navitas not to proceed with the farm-in. During this period, Rockhopper’s share of Sea Lion project costs will continue to be borne by Premier under the same terms as previously announced’.

Samuel Moody, Chief Executive Officer, commented:

“We will work closely with all stakeholders over the coming months to maximise the chance of securing the farm out and project sanction of Sea Lion. We believe that the opportunity to invest in a 500 million barrel fully appraised and engineered project with material additional upside at this point in the cycle presents a compelling opportunity, and one which would lead us towards unlocking the value within the project long-awaited by all stakeholders.”

Eco (Atlantic) Oil & Gas

Eco has announced that it has successfully negotiated the reissuance of its four licences in the Walvis Basin, Offshore Namibia conditional to customary final government signature.

Eco has negotiated the reissuance and establishment of a new 10-year life cycle for each of the four PEL’s. Each license has a participation of a standard 10% WI with NAMCOR, Namibia’s National Petroleum Corporation and in keeping with the Company’s support of local interests, Eco has negotiated and established a 5% WI with local Namibian business partners on each block. Azinam Group also participates in a minority capacity on the Cooper, Sharon and Guy Blocks.

‘With the establishment of the new PEL’s, the Company has doubled the size of its Guy block acreage, increasing the potential for new prospective targets in the deeper horizon to the West of the block. The new PELs cover approximately 28,593 km2, with over 2.362 Billion BOE of prospective P50 resources’.

Gil Holzman, President and Chief Executive Officer of Eco Atlantic, commented:

“Successfully renegotiating our four licences offshore Namibia and being awarded over 28,500 km2 in one of the most exciting exploration hotspots in the world is a significant milestone for Eco.  Participation in the regional exploration with a number of the major IOCs now in Namibia, and having the Namibia Ministry of Mines and Energy acknowledge both our long term investment and our contribution to the fundamental exploration of the region, is very meaningful, both for us as a business and an explorer.

“Eco has made a significant investment in these offshore blocks in the Walvis Basin to date and we have been able to increase our already substantial footprint (now the second largest after ExxonMobil) in a highly prospective region that has attracted the interest of a number of the major IOCs.

 “The recent wildcat discoveries in South Africa and the entry into Namibia by ExxonMobil, Total, Qatar Petroleum and Shell over the last few years give us significant confidence that further discoveries will soon be made in Namibia. Near term, we look forward to drilling campaigns planned by Total, Shell, M&P, and ExxonMobil. These companies are amongst the leading oil finders in the world. The new licenses represent a strategic value creation opportunity for Eco Atlantic, amid the increased interest in the area.”

Although Eco has had to delay further exploration in Guyana thanks to Tullow’s recent problems it is clear that the company is still working hard in Namibia, an area where there is considerable promise and interest by leading oil companies. The size of the portfolio in the country dwarfs the market cap which at only £38m surely does not in any way take into account the size of the prize in either country. Patience is a virtue and investors will in due course be significantly rewarded.

Angus Energy

Angus has announced an MOU with Aleph Energy for the £12m financing for the development of its Saltfleetby gas field.

George Lucan, Angus CEO, comments: “We believe that these terms potentially represent a great result for shareholders in a difficult time for fundraising for any hydrocarbon project.  Saltfleetby is a considerable opportunity with, according to the CPR of 4 March 2020, the potential to deliver between £75 million (P90) and £250 million (P10) of gross revenues to all parties over its remaining life.

It is also exciting for us to have a potential partner who marries technical and commercial skills as well as proven access to considerable pools of private capital. We believe Aleph is the right partner to smaller scale energy and ESG projects that provide much needed local employment and displace more polluting energy fuel sources.

We see in geothermal, in particular, a natural extension of our drilling and subsurface geological expertise, our teams’ experience of working safely in high pressure and high temperature environments subject to rigorous environmental standards and of dealing with local planning issues with extreme sensitivity.

In view of the impending Christmas break and inevitable Covid-19 related delay, we expect to conclude documentation and drawdown by the end of January but at any rate in the early first quarter 2021 following which we will be able to accelerate the procurement process as we head toward First Gas in H1.  In the meantime, we continue with detailed design whilst isolating key long-lead items for express procurement and are happy to note that our hydrogen ready pipe is now safely laid and we are progressing with the final 150 m steel stretch of the pipeline.”

And finally…

That was quite some Bahrain GP, not many thought that Grosjean would walk away from that fireball. After a long delay the race eventually finished under the safety car with Lewis Hamilton winning ahead of the two Red Bulls.

With plenty of opportunities to gain places in the table all results were on in this crazy season. The Magpies won at the Eagles, the Seagulls scored a late equaliser against Liverpool, the Noisy Neighbours put 5 on Burnley and Leeds raided Goodison and took all three points from the Toffees. The Baggies eventually found that win, beating the Blades who are also struggling, as are the Gooners who lost at home to Wolves meanwhile the London derby between Spurs and Chelski ended goalless and the Red Devils came back from 2-0 down to beat the Saints 2-3, another away win…Tonight the Foxes host the Cottagers and in the battle of the claret and blues Villa go to the Hammers.

It will be worth tuning into the FA Cup draw tonight with some minnows in the bag…In Scotland Celtic went out of the League Cup at home to Ross County….can the manager keep the job?

In South Africa England won the 2nd T20 against the Proteas and hence the series is won, after the next game we go to an ODI series.

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