SP Angel. Morning Energiser. Crude oil prices move higher
Market Update: 19 April 2022
Rex International Holding* (5WH:SGX) - Acquires 2 new licences in Norway
Arrow Exploration Corp (TSX-V:AXL, AIM:AXL, OTC:CSTPF)- Positive update on RCE-2 well
United Oil & Gas PLC (AIM:UOG) - 1Q production in-line
Energy Prices
Brent Oil US$111.4/bbl vs US$107.6/bbl Thursday
WTI Oil US$107.3/bbl vs US$103.7/bbl Thursday
Henry Hub Gas US$7.78/mmbtu vs US$7.05/mmbtu Thursday
UK NBP Futures 174p/therm vs 199p/therm Thursday
TTF Dutch Futures €93.6/MWh vs €100.7/MWh Thursday
- Oil prices continued higher over the Easter weekend on Libyan outages due to political unrest and the growing risk of an EU-wide ban on Russian oil imports in response to its invasion of Ukraine.
- The US rig count climbed by 4 to 693 rigs last week, its highest level since March 2020, split equally between 2 units targeting gas and 2 units for oil.
- European energy prices fell as expectations for warmer weather this week reduced demand for Russian supplies, with Gazprom reporting today’s gas nominations were at 54.8mcm.
- US natural gas prices reached their highest level since 2008 on the back of an unexpected cold snap that is expected to bring snow and ice to northern states this week.
Company News
Rex International Holding* (5WH:SGX) S$0.35, Market Cap £256m: Acquires 2 new licences in Norway
- Rex has confirmed that its 91.65% subsidiary, Lime Petroleum, has signed an agreement with MOL to acquire its 40% interests in licences PL820S and PL820SB in the Norwegian North Sea.
- The licences contain the Iving and Evra discoveries, which hold 11.5mboe recoverable reserves, and lie on the Utsira High area adjacent to the producing Balder field.
- Separately, Rex announced March production of 3.56kboe/d net to Lime in Norway and 4.64kb/d from the Yumna Field in offshore Block 50 Oman, following the planned change-out of the MOPU and storage tanker.
The acquired licences in Norway, subject to approval, will mark the next natural step for Lime to seek operator status and provide additional prospectivity in an area already known to management and just north of its PL818 Orkja and PL867 Gjegnalunden exploration licences.
*SP Angel acts as Corporate Broker to Rex International Holding
Arrow Exploration Corp (TSX-V:AXL, AIM:AXL, OTC:CSTPF) 15.1p, Market Cap £32m: Positive update on RCE-2 well
- Arrow Exploration announced 80 feet of net pay over five separate known producing horizons in the Rio Cravo Este-2 well on the Tapir Block (50% WI) in the Llanos Basin of Colombia.
- The casing cementing of the well is expected to be completed on 20 April, followed by a thorough production testing programme. Testing is expected to take approximately five days per zone.
Management believes that more than one pay zone will be productive, which should benefit investors as the Company looks for new resources on the licence to drive its production and cashflow growth whilst also benefitting from the material uplift in commodity pricing in recent months. We await test results on the RCE-2 well.
United Oil & Gas PLC (AIM:UOG) 2.6p, Market Cap £17m: 1Q production in-line
- United reported 1Q22 net production averaged 1.57kboe/d (~81% oil) from its non-operated Abu Sennan licence (22% WI) onshore Egypt, in line with 1H22 guidance of 1.5-1.65kboe/d.
- The ASV-1X exploration well has commenced drilling targeting 2.6mb gross mean recoverable resources with results expected in late 2Q22.
- United will be releasing its FY21 results on the 26 April 2022.
United’s production is highly leveraged to the current higher oil prices and oil/gas discoveries can be quickly brought on stream through existing facilities, generating immediate revenue for the Company. Investors can also look forward to results from the ASV-1X well later this quarter.
Research
David Mirzai – David.Mirzai@spangel.co.uk – 0203 470 0473
Sales
Richard Parlons – Richard.Parlons@spangel.co.uk - 0203 470 0472
Abigail Wayne – Abigail.Wayne@spangel.co.uk - 0203 470 0534
Rob Rees – Rob.Rees@spangel.co.uk - 0203 470 0535
Grant Barker – Grant.Barker@spangel.co.uk – 0203 470 0471
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Sources of commodity prices
Oil Brent - ICE
Natural Gas - NYMEX
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