In today’s update, Jim covers the companies he is interested in and what is catching his attention this week.

It was a quieter second half of the week, but still a few pieces of news worth mentioning.

I3 Energy announced the spud of the Serenity SA-1. This is now stated to be an appraisal well and is expected to take four weeks.

Petro Matad announced the commencement of testing of Heron-1. Operations are expected to be completed this month.

Coro Energy and Empyrean Energy announced the Tambak-2 well spud. Total time to drill, core, log and test is estimated to be approximately 33 days, after which the rig is planned to move to the Tambak-1 location. The Tambak-2 well is primarily designed as an appraisal of the southern area of the Mako gas field and is a very large step out (over 13 km) south of the Mako South-1 location. It sounds more like an exploration well.

Anyway, all four companies should offer trading opportunities over the next month or so.

Zenith Energy announced results of its C-37 well. It came in at a maximum of 50 barrels of oil per day after a significant water cut, exactly the same as Block Energy's recent well next door in Georgia.

Bahamas Petroleum Company had a turbulent week. By Wednesday, it had collapsed to half of the price of two weeks ago when I said it looked overvalued. Thursday it issued a statement regarding potential fundraising denying any immediate intentions of undertaking an equity placing.

Shorts panicked and pushed the share price back up over 2p. Reality is it's very unlikely that they will be able to arrange a farm-out and in my opinion, it's only going to be possible to raise the funds for the well they have to drill with a very substantial equity placing. I think this will happen and at a much lower price, at which point I believe it's worth looking at.

Another company which is going to need a large placing is Tower Resources, which issued non-news last week I guess to excuse a price move up. TRP is another one that will be interesting post-placing.

Still, on the subject of placings, Reabold Resources also issued a statement regarding potential fundraising. It's in the process of taking indications of interest from investors with regard to an equity placing of between £20 - 24 million.

The same group that runs Coro Energy, Echo Energy and Sound Energy have taken Nu-oil & Gas as their next shell. There's undoubtedly a deal coming up, but with the group controlling a billion 0.05p placing shares and 5 billion more shares coming from a £2.5 million loan converting at the same 0.05p price, there's going to be a huge amount of stock coming out.

It all comes down to the strength of the deal coming in, but confidence in the group has been weakened by a poor choice of deals leading to large investor losses at Sound and Echo and NUOG is a pure bet on how high they can ramp it.

I'll be back mid-week with more on the podcast.

In the meantime, all the small-cap oil companies are covered in the Sunday blog and daily on Twitter.

There's been a lot of news so far this week, but mainly companies getting out their interim results at the last minute, so I'll focus on the more interesting ones and those that might offer potential.

 

Providence Resources and Lansdowne Oil & Gas eventually had to call it a day with the Chinese investors after their funds they claimed to have transferred yet again failed to arrive.  Providence now is capitalised at £24 million and Lansdowne at £6 million, but in Barryroe they do actually own a genuine asset.  The shares are highly speculative, but offer huge and real potential.  Estimated 2C recoverable resources are over 300 million barrels of oil from the two main tested reservoir intervals at Barryroe, and further resource potential has also been identified in other hydrocarbon bearing intervals with estimates of up to over 1 billion barrels of oil.  I think Providence and Lansdowne might be worth a punt at these levels.

 

UK Oil & Gas and Alba Mineral Resourcesannounced the spud of the Horse Hill-2/2z Portland well.  Both the HH-2z and the existing HH-1 Kimmeridge well are expected to be put into long term production by the end of 2019.  I suspect production could easily surpass 1,000 barrels of oil per day - and they have permission to drill another four wells.  Given its niche as a British onshore oil producer, UKOG at a current capitalisation of £67 million and ALBA at a capitalisation of £7 million offer opportunity.

 

Global Petroleum is a company rarely mentioned.  It's capitalised at just £3 million, but has a lot of assets, particularly its licences offshore Namibia, which cover 11,607 square kilometres (that's nearly 3 million acres) and make it one of the largest acreage holders in the region.  Global also own licences offshore Italy where it has been fighting actions by environmentalists in the courts - and winning.  It's an interesting situation now in Italy, since to stop these endless battles between oil companies and greens, the Italian Parliament passed a Bill in February this year suspending all hydrocarbon exploration activities, including permit applications, for a period of 18 months. Following the 18 month evaluation period, the intention is that a hydrocarbon plan will be activated, setting out a strategy for exploration and production, excluding certain areas from future hydrocarbon exploitation.  These environmental disputes are what has been holding back oil exploration activity in Italy and those companies whose areas do get approved are going to hit the jackpot, since many of the potential resources in these licences are huge and highly profitable if allowed to be developed.  The company has more than enough cash to keep it going and Global is another one that could be worth a punt.  It just takes one farm-out to propel this North.

 

I3 Energy issued its interim report on Monday and set out a clear explanation of the current situation.  The first well result was a surprise to the third-party consultants who conducted due diligence, which I think explains the heavy institutional selling.  All three sets of seismic utilised to map the Liberator structure had conformed to one another and resolved the 13/23c-9 well location as a low-risk target at a structural high.  However, the targeted upper Captain sand was not penetrated at the first well location, so i3 acquired the only other available seismic dataset over the area. This had previously been reviewed by the Company and determined to be unsuitable.  However, reprocessed, they believe this seismic will enable additional interpretation. To allow time to analyse the data and potentially re-permit an alternative location for Liberator's next appraisal well, i3 is preparing the rig to drill Serenity's SA-01 as the second well. Mobilisation operations will commence as soon as the consent to locate permit is obtained and, once drilling begins, the well is anticipated to take approximately four weeks.  I think the current market capitalisation of £20 million looks fair.  From here, there is going to be an exploration well targeting a potentially significant target at Serenity and possibly an appraisal well at Liberator.  It's no longer the development deal it was before, but like the others mentioned previously it could be an interesting speculation.

 

Independent Oil & Gas which I mentioned positively at the weekend is still being bought by Richard Griffiths of Jersey and Lombard Odier, both of whom filed TR-1s. There's good news flow coming up here and I thought it interesting to see that IG is no longer allowing leveraged purchases on this.  The market capitalisation is £73 million, so there's still plenty of upside when the scale of the project is considered.

 

Finally, Bahamas Petroleum Company, which I stated the last two weekends as currently overpriced but interesting once a placing is done, is now down by about half.  They've now formally announced that they're in the process of arranging funding for their big drill next year and as I've said before it's one to keep an eye on and look at picking up after the placing.

 

I'll be back at the weekend with more on the podcast.

 

In the meantime, all the small-cap oil companies are covered in the blog and daily on Twitter.

We talk with Paul Johnson, CEO of Power Metal Resources, about his recent RNS regarding Botswana. Paul provides some insight into the RNS detail and reveals what the next steps are.

Chariot Oil & Gas announced its first half results.  The 30 June cash position was $12.1 million, with no debt and all commitments fully funded. The market capitalisation by comparison is £14 million, so you’re not paying much for their licences in Morocco, Brazil and Namibia. The Lixus licence alone has audited total remaining recoverable resources in excess of 2 trillion cubic feet of gas. They’re looking to farm out all these licences and given their ability to farm-out prospects previously there is big upside here.

Independent Oil & Gas announced its interim results.  They’ve set out their future news flow which will include: completion of Farm-out to CalEnergy Resources; First Investment Decision and commencement of Core Project Phase 1 project execution; Full Harvey appraisal well results; and CalEnergy Resources option to farm in to Harvey. I’m starting to warm towards Independent Oil & Gas and it’s also encouraging to see Lombard Odier keep buying too.

Borders & Southern announced results for the six months ended 30 June and the company is now actively pursuing a farm-in partner for its Darwin project. Industry reach has been extensive and they continue to present what they say is their robust technical and commercial proposition to new companies. If they can pull off a farm-out of their Falkland’s licences, the potential is huge. The market capitalisation is just £7 million, but assets in the balance sheet are over £296 million

Bahamas Petroleum Company announced interim results. They’ve entered into a framework agreement with Seadrill for the provision of a rig in the first half of 2020; they’ve appointed Halliburton for integrated well services and BakerHughes for provision of various well-related equipment. There’s a £10.25 million conditional convertible loan note to underpin finance necessary for the drilling of the well if required, and additional finance sources being evaluated. They say the farm-in process continues. To give them insurance, they’ve now got AGM approval for the temporary authority for issue of new shares to further contribute to the financing of drilling, if required. I said last weekend that the most likely outcome here is a large discounted placing and that the shares were looking expensive.  Now they’ve come off quite a bit since then ( the market cap was ,£41 million a week ago, it’s £32 million now), but it still looks expensive on an un-financed basis.  I do think it could be interesting once the fund raising is done, so it’s one very much to keep an eye on 

Lansdowne Oil & Gas announced Interim Results. As they stated, "The key issue facing the Company is the delay in the delivery of the loan funds from APEC, as called for under the Farm-Out Agreement.”  The last extended backstop date is this Monday and it won’t be looking good for them if the cash has still not arrived. Same applies to Providence Resources too.

Anglo African Oil & Gas issued its Half-year Report. Well re-entry operations have started and with an operational team in place and a funding package finalised, they’re now concentrating on signing a rig contract for the sidetrack into the Djeno. Difficult to know what’s going to happen here, but it’s always worth keeping an eye on, if only for amusement.

Reabold Resources released Interim Accounts showing average production in California of 42 bopd in the 1st half with operating costs running at 56% of revenue. They claim production of 142 boepd for July & August, but how much is gas, which in the US is really worth very little? And unlike the first 6 months of the year, they didn't state oil production. Finally, why did they disclose only 20 bopd net as current production in their September RNS? Other questions asked by me in July regarding the £3 million offshore purchase of the California earn-in agreement also are being asked by others too, so let’s see if the answers come out now.

I'll be back mid-week with more on the podcast.

In the meantime, all the small-cap oil companies are covered in the Sunday blog and daily on Twitter.

Three companies currently are underway with their drilling programmes: I3 Energy, Petro Matad and Hurricane Energy, which announced the spud of its Warwick West well earlier this week.  Petro Matad awaits the test results of Heron-1 and the initial drill results of Gazelle-1.

I3 Energy is awaiting the spud of its Serenity exploration well, with the Liberator appraisal well delayed pending the processing and interpretation of new seismic data.  Pending the outcome of the drills, I think the latter two are purely for trading. Of those with drills coming up and another one operating in the North Sea, Independent Oil & Gas announced the settlement of its 100 million Euro bond raise, fully funding them for their core project next year.

In the meantime, data acquired from the Harvey well is now undergoing analysis to generate a revised technical assessment of reservoir gas volumes and deliverability.

Onshore UK, Alba Mineral Resources and UK Oil & Gas announced the arrival of the rig at Horse Hill.  The spud of the Portland horizontal well is expected imminently.  Drilling operations are expected to be completed in approximately 60 days.

Empyrean Energy and Coro Energy announced the mobilisation of the jack up rig from Singapore, which is now en route to the location for the first well offshore Indonesia.  The campaign will comprise of two wells, one to appraise the Mako gas field discovery and one to both appraise the Mako gas field at another location  and test the deeper Tambak prospect.

Current favourites out of the above are UK Oil & Gas and, to a lesser extent, Independent Oil & Gas.  Coro might have some potential too.

Petrel Resources announced the appointment of Michel Fayad to the Board.They now aim to acquire and fund a big project in the Middle East & North Africa region.  I stated Petrel as a favourite at around 1p, it's now close to 10p - and perhaps going higher still.

Block Energy No surprises for blog readers in today's RNS.  Instead of the touted 1,100 barrels of oil per day, production actually turned out to be 230 barrels of liquid a day with a water cut of 78% That's just 50 barrels of oil per day, but still outdoes

Reabold Resources, who after a year of supposed production and announcements of wells coming in at several hundred barrels a day, were only able to announce actual net production of 20 barrels of oil per day.  Again, this will be no surprise to blog readers

Ending with some better quality companies which actually do produce commercial quantities of oil, Serica Energy and RockRose Energy announced interims with strong numbers.  Further acquisitions will be the big share price driver with these two. I'll be back at the weekend with more on the podcast. In the meantime, all the small-cap oil companies are covered in the blog and daily on Twitter.

Here is Jim market update, from across this week's Oil & Gas company news, our readers, subscribers may be aware that we now publish the weekly bog that @Oilman_Jim (https://twitter.com/Oilman_Jim) publishes each Sunday.

In today’s update, Jim covers the companies he is interested in and what is catching his attention this week.

Bahamas Petroleum Company PLC (LON: BPC) pasted shareholder resolutions to finance the up and coming drills. Europa Oil & Gas (Holdings) Plc (LON: EOG) Award of Large Exploration Licence (https://www.share-talk.com/europa-oil-gas-holdings-loneog-award-of-large-exploration-licence-offshore-morocco/) , Offshore Morocco. Chariot Oil & Gas Ld (LON: CHAR) Competent Persons Report on Additional Prospects, Lixus Offshore Licence, Morocco.

Clontarf Energy PLC (LON: CLON) Interim Statement (https://www.share-talk.com/clontarf-energy-plc-lonclon-interim-statement-for-period-ended-30-june-2019/) for the period ended 30 June 2019. Eco (Atlantic) O&G (LON: ECO) Second Oil Discovery (https://www.share-talk.com/eco-atlantic-og-loneco-second-oil-discovery-offshore-guyana/) Offshore Guyana. Petro Matad Ltd (LON: MATD) Spud (https://www.share-talk.com/petro-matad-ltd-lonmatd-spud-of-exploration-well-gazelle-1/) of exploration well Gazelle-1.

i3 Energy PLC (LON: I3E) Operations Update (https://www.share-talk.com/i3-energy-plc-loni3e-operations-update/) Providence Resources (LON: PVR) Operational Update - Standard Exploration Licence 1/11 Completion of Barryroe Site Survey. Lansdowne Oil & Gas Plc (LON: LOGP)

Here is Jim latest update, our readers, subscribers will be aware that we now publish the weekly bog that @Oilman_Jim (https://twitter.com/Oilman_Jim) publishes each Sunday. 

In today's update, Jim covers the companies he is interested in and what is catching his attention this week.  

Eco (Atlantic) O&G (ECO) Second Oil Discovery (https://www.share-talk.com/eco-atlantic-og-loneco-second-oil-discovery-offshore-guyana/) Offshore Guyana announced a further discovery on Joe-1, the second well on the Orinduik Block. Petro Matad Ltd MATD) Spud of exploration well (https://www.share-talk.com/petro-matad-ltd-lonmatd-spud-of-exploration-well-gazelle-1/) Gazelle-1 today. i3 Energy PLC (I3E) Borgland Dolphin drilling activity with two more fully funded wells to go for. 

Providence Resources (LON: PVR) on-site survey, cash position, Zenith Energy (ZEN) announcement, Nostra Terra Oil and Gas Company (NTOG), West Newton play,  Block Energy PLC (BLOE).

Share Talk first came across Jim Tweets (https://twitter.com/Oilman_Jim) a couple of years ago and we would read his weekly blog (https://www.share-talk.com/category/oilman-jim/) that covered all the highs and lows with a look back at some of the interesting news stories from London’s junior oilers.

Followers, subscribers will be aware that we now publish the weekly bog that @Oilman_Jim (https://twitter.com/Oilman_Jim) publishes each Sunday. We are happy to be able to announce that Jim has agreed to publish a podcast covering some of the junior oilers he is interested in.

UK Oil & Gas PLC (LON: UKOG) (https://www.share-talk.com/uk-oil-gas-plc-lonukog-the-week-that-changed-everything/) The Week that changed everything! On Tuesday we had the update of the Completion of Acquisition (https://www.share-talk.com/uk-oil-gas-plc-lonukog-completion-of-acquisition-in-horse-hill-2/) in Horse Hill.

Wednesday the Surrey County Council Planning and Regulatory Committee granted full planning consent (https://www.share-talk.com/uk-oil-gas-plc-lonukog-horse-hill-granted-long-term-production-consent/) for long-term oil production at the Company’s flagship Horse Hill oil field near Gatwick Airport. This landmark milestone, perhaps the most significant event at Horse Hill since the HH-1 oil discovery, paves the way for the Company to realise the full value of future long-term production from the Horse Hill oil field.

i3 Energy PLC (LON: I3E) (https://www.share-talk.com/i3-energy-plc-loni3e-liberator-well-13-23c-9-preliminary-result/) Liberator Well 13/23c-9 Preliminary Result. Announces that the 13/23c-9 pilot well drilled by the Borgland Dolphin on i3 Energy’s 100% owned Liberator Field has reached total depth at 5818 ft True Vertical Depth Sub-sea (TVDSS) in the Valhall formation.

Petro Matad Ltd (LON: MATD) (https://www.share-talk.com/petro-matad-ltd-lonmatd-heron-1-results-of-drilling-and-wireline-logging/) Heron-1, results of drilling and wireline logging. Data were consistent with our pre-drill prognosis, there is also evidence of zones with better than expected porosity/permeability characteristics.

The well will now be tested and we are pushing the contractor to mobilise equipment as quickly as possible. Further updates will be provided in due course.

Zenith Energy Ltd (LON: ZEN) (https://www.investegate.co.uk/zenith-energy-ltd--zen-/rns/successful-drilling-results/201909090700086256L/) Successful Drilling Results. The Company confirms that the deepening of well C-37 has successfully identified three untapped oil-bearing clastic layers in the Middle Eocene formation with a total net pay zone of approximately 16 metres.

Reabold Resources (LON: RBD) (https://www.investegate.co.uk/reabold-resources--rbd-/rns/successful-appraisal-well-at-parta-licence-romania/201909090700086252L/) Successful Appraisal Well at Parta Licence Romania. The announcement made by ADX Energy Ltd ("ADX") regarding an update on the drilling of the Iecea Mica-1 ("IM-1") appraisal well, located within the Parta license, onshore Romania. Drilling has been completed safely and hydrocarbons have been discovered in multiple zones.

Reabold holds 37 per cent. equity interest in Danube Petroleum, which has 100% working interest in the sole risk area within the Parta licence that includes IM-1, as well as 50 per cent. of the remainder of the Parta licence. ADX is the operator of the well.

ANGLO AFRICAN O&G (LON: AAOG) (https://www.share-talk.com/anglo-african-og-lonaaog-board-changes/) Board Changes. David Sefton has made the decision to resign his position as Executive Chairman and as a director of the Company. David has been instrumental in the development of the Company since 2016.

Still no cash from China for Providence Resources (LON: PVR) (https://www.investegate.co.uk/providence-res---pvr-/gnw/providence-resources-p-l-c----conditional-placing-to-raise-us-3-76-million/20190912070000H2345/) and Lansdowne Oil & Gas (LOGP), however, PVR has started the Barryroe site survey regardless. Absent receipt of funds, both PVR and LOGP are going to have to obtain financing virtually immediately.

Providence Resources (LON: PVR) (https://www.investegate.co.uk/providence-res---pvr-/gnw/providence-resources-p-l-c----conditional-placing-to-raise-us-3-76-million/20190912070000H2345/) Conditional Placing to raise US$3.76 million

Cameron Parry, Chief Executive Officer, commented: “I am pleased to report that there are nearly 1,000 Tally® account holders currently and this has been achieved mainly through organic growth since the App was released in mid-June.

“I am also pleased to report that the Company has completed a successful pre-Series A capital raise from private investors, and we are thankful for their support.  We continue to also be appreciative of our existing shareholders, who have been patiently bearing with us as TALLY has grown its product offering and business scope.  And we are mindful that the revised timeline needed to list the Company’s shares may be disappointing or frustrating, but we must continue to focus on achieving relevant milestones in order to deliver a successful IPO.

Martin Higginson, CEO of Immotion Group, took the time to speak with Share Talk and explain how the company works, where he sees VR in todays market and their strategy for growth.