Posted by Malcolm Graham-Wood - Malcy's Blog
Nearly 15% up from the June lows and the oil price continues its bull run although I suspect that with some closing pre the Independence Day holiday today and technical resistance for Brent at $50 we may have seen the short term highs. With the market shut today expect a quiet ride in other bourses and later in the week inventory stats and the rig count will play their parts.
Victoria Oil & Gas
VOG has announced that the participation agreement has been agreed between itself, partner RSM and the state company SNH who are entitled to exercise its right to a stake in the project. Following this GDC will have 57%, RSM 38% and SNH 5% and there will be an audit for the SNH share of costs. This is good news and further proof that Logbaba and VOG through GDC will be part of the furniture for a very long time. Elsewhere the termination date for the Bowleven farm-out of Bomono has been extended to 28th September 2017 as both sides wish to pursue the deal and are working with the oil ministry to complete the deal. If this does complete then VOG will have a pincer movement of gas supply at both ends of Douala where GDC has a strong, if not dominant position in the gas distribution market.
A pre-close trading statement from Hunting today that shows that of the UK quoted service companies they are taking best advantage of the US onshore drilling frenzy. The first half has benefited from the US onshore drilling pickup particularly in the Permian in West Texas. The perforating systems business has been the winner here, not only ahead of expectations, to the extent that shifts have been increased but even a plant has been recommissioned.Elsewhere as can be imagined it's a pretty mixed bag, OCTG has done well with orders from the US shale and the Middle East but well construction is ‘difficult' and well intervention ‘subdued due to a slow deepwater market, we were warned…There will be a positive EBITDA but pre-tax will be in the red, debt is up for good reasons as the order book is rising. A long way to go on most fronts but at least HTG is protected by the exposure to the US shale market.
Patience and faith has rewarded backers of RockRose and Andrew Austin as the shares, suspended at 44.625p will reappear from suspension on Thursday at 150p or thereabouts. Whilst being a bit drawn out, primarily I understand for regulatory and approval reasons which should now be swifter, RRE have a number of deals to report, some previously known, some not. From Maersk the Scott and Telfer assets are performing well with decommissioning pushed out and the operator still spending on the project. Elsewhere the Egerton deal already announced appears to be proceeding and the ‘mystery' deal is now confirmed as being with Sojitz which brings 15% of Tors, 7.5% of Grove and 10% of Seven Seas in the SNS. All in all RRE will have around 1,400 boe/d after these deals with the intention of building this to 12/- to 15/- b/d in around two years.
The placing is for £8m of which £4m is coming from Arunvill and most of the rest from existing holders, a reward for their ‘leap of trust' in AA and his small team when they effectively bought into a blind trust at the off. With plenty of cash already, this raise adds to that so the company is backed by cash and with potential asset purchases up their sleeve looks well set for substantial growth.
You couldnt make it up, only in an English County Council could a planning committee go against the recommendation of its own planning department and refuse an application that had addressed all the concerns previously raised. This means that the Wressle field and its important revenue will be delayed yet again whilst the Councillors raise a toast to their own importance…
Yesterday was Voxmarkets Podcast day and I chatted about recent developments at HUR, SOU, VOG and FPM, the link is right here.
In one of the biggest goofs since I started putting sports news in the blog I had a torrent of emails yesterday about the omission of the wonderful victory by the British and Irish Lions (better put in full title as I get stick otherwise…) against the All Blacks on Saturday morning. It was not as if I didnt know, a highlight of the sporting summer I watched every moment of it and like most jubilant about the result.
As if I didnt need reminding I also forgot, probably deliberately to mention that Notts beat Surrey in the One Day final that we used to call the Gillette cup, well done to Stoneman who wasnt backed up well enough but particularly to Alex Hales who produced a masterpiece.
At Wimbledon good news to Team GB with Muzza, Konta and Bedene getting through, today Kyle Edmund will play fellow Brit Alex Ward.
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