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Arrow Exploration (AXL LN/CN)C; Target price of £0.45 per share: Positive drilling results at RCS-1 could add further reserves - The RCS-1 well (the second well drilled by Arrow in Colombia this year) has encountered >55 feet of total net pay across six separate oil-bearing reservoirs in the C7, the Gacheta and the Ubaque, between 7,077 feet and 8,105 feet. No reserves were allocated to the Ubaque, C7 and one of the Gacheta sands. Thes
Companies: UKOG SQZ SOU CASP SOU SAVE REP REP JSE GTE EQNR EQNR ENI ENI COP COP TLW CNE CNE CNE ALV ALV SDX LBE HHR EGY AXL
ALV announced another strong set of results on the back of record production, which averaged 14.3mmcf/d of gas and 2.5kboe/d total in Q1’22 (+15% y/y; 3% q/q). April volumes have remained similar to Q1’22. The average realised price was US$10/mcf (+77% y/y) after the price rise from February and the stronger BRL versus USD; opex has remained below US$4/boe. The combination of higher production and pricing doubled revenues y/y to US$13mm. EBITDAX was US$11.1mm and fund flows from operations were
Companies: ALVOPETRO ENERGY (ALV:TSE)Alvopetro Energy Ltd. (ALV:TSX)
Hannam & Partners
ADX Energy (ADX AU)C; Target price of A$0.060 per share: Better reservoir performance than expected at Anshof - The Anshof-3 well has flowed at a maximum rate of 132 bbl/d (light oil and no water) from the Eocene reservoir. This is well above the flow rate of ~75 bbl/d announced two weeks ago and initial expectations of 40 80 bbl/d. Downhole pressure data recorded during the test also indicates better than expected reservoir flow perfo
Companies: TXP PXT TGL SENX KOS CZA AOI CNE CNE EQNR I3E TETY TETY VLE GENL FEC ENOG EME DNO DNO CNE AKRBP AKERBP ALV ALV PEN PEN GPRK GPRK ADX LBE
Imperial Helium (IHC CN)C; Under review: Merger with Royal Helium to build a material player with discovered resources and huge upside - Imperial Helium is merging with Royal Helium with Imperial Helium shareholders set to hold ~30% of the combined entity. The share exchange ratio suggests a 10% premium to the Imperial Helium share price on the day prior to the announcement. Shareholders will vote on the transaction in June with completion expected in the 2nd half of June. Management, insiders a
Companies: XOM XOM TRIN SHEL RBD OEX NOG MATD ALV ALV IOG GTE FEC EQNR EQNR ENOG BP/ IHC PEN PEN SDX EGY
Alvopetro announced yesterday that it had completed drilling on its 182-C1 well on its 100% owned Block 182 in the Recôncavo basin. The well, which was spud on 2nd March and drilled to a measured depth of 2,926m, encountered 36m of sands in the Agua Grande Formation (primary target) of which there was 25m of potential net gas pay, with an average porosity of 8.2%. The logs indicated natural gas pay but this will need to be confirmed with well testing. A secondary target, the Sergi Formation, was
Arrow Exploration (AXL LN)C; Target price of £0.45 per share: Very encouraging drilling results at Colombia well - The RCE-2 well has encountered a total net pay of ~80’ across five separate known horizons. Importantly the C7 sand (the primary target) was encountered 10’ higher than expected and 25’ higher than in the RCE-1 well. Overall 30’ of pay was encountered in the C7 sand. This suggests larger volumes than expected. The well als
Companies: EME TRIN SQZ SOU MAHAA HUR GTE DNO DNO XOP ALV ALV SDX CEG AXL
Looking at E&P Free Cash Flow - While companies still carry hedges contracted at lower prices, we estimate our producer universe will generate ~25% FCF yield (defined as FCF/EV) in 2022 at ~US$100/bbl. At just US$70/bbl, the overall FCF yield is estimated at 15% for 2023 and >20% for 2024. Assuming US$110/bbl, this increases further to ~40% for each of 2023 and 2024. At YE24, balance sheet net cash, after paying shareholder distributio
Companies: SOU OMV OMV VOG TGL SNM CASP BLOK SHEL REP REP IGAS ENI ENI ECHO I3E CNE ALV ALV SDX GPRK GPRK LBE ADX AXL CE1 PEN PEN TAL PHAR TETY TETY EGY WEN
ALV announced another strong set of results on the back of continued high
production, which averaged 13.5mmcf/d of gas and 2.4kboe/d total in Q4’21.
Production, which was described as “way exceeding” expectations, has
continued to be strong in Q1’22 at ~2.5kboe/d to date with record sales in
January. ALV generated US$25mm of EBITDA in 2021 at an average realised
gas price of US$6.50/mcf and its low costs resulted in a netback of US$33/boe.
ALV finished 2021 with cash of US$11.5mm and in Febr
Pharos Energy (PHAR LN)C; Target price of £0.50 per share: Deep value and large free cash flow – The FY21 actuals were in line with previous indications. The FY21 operating cashflow (post tax) adjusted for US$30 mm hedging losses and a ~US$9 mm change in working capital is ~US$50 mm. The farm out transaction with IPR is expected to complete imminently as the only outstanding CP is the signature of the Ministry of Petroleum. This will t
Companies: TGL TCFF TCF SOU OMV OMV IOG ENI ENI EOG HUR PHAR GENL AKRBP AKERBP ALV ALV BP/ CNE
GeoPark (GPRK US)C; Target price of US$27.00 per share: Reiterating guidance. Doubling dividend. ~US$270 mm free cash flow in 2022 at US$90/bbl – While the YE21 cash and 4Q21 production had previously been reported, 4Q21 operating cashflow of US$88 mm (US$82 mm excluding working capital movement) was higher than we expected (US$72 mm). While this was offset by higher capex than we carried, we view the strong cash flow as a good indicat
Companies: TXP TLW TGL SDX LUPE FEC ENI ENI CNE CNE CNE ALV ALV GPRK GPRK IHC LBE EGY
Calima Energy (CE1 AU)C; Target price of A$0.65 per share: A$20 mm equity raise to fund growth – Calima has raised A$20 mm of new equity priced at A$0.20 per share to fund growth and boost its balance sheet. With ~A$16 mm capex in 1Q22, a “maxed-out” debt facility and covenant restrictions, the additional equity funding will allow Calima to sustain its capex programme and secure equipment ahead of the spring break-up period rather than
Companies: 88E AKRBP AKERBP ALV ALV BP/ CE1 CNE DNO DNO EQNR EQNR I3E JSE PAT TAL SHEL TETY TETY TTE EGY
ADX Energy (ADX AU)C; Target price of A$0.040 per share: Logging results at exploration well in Austria – Logging results from the Anshof-3 well confirmed 2.5-4 m of productive net pay at the primary oil Eocene target and 14 m of net gas pay at the Miocene sands. The secondary Cenomanian oil zone is not likely to be productive at this location due to low permeability. The Eocene net reservoir thickness at Anshof-3 location came in at t
Companies: TOM ADX ALV ALV BLOK CE1 XOP CHAR EQNR EQNR IOG OMV OMV SHEL TGL
Arrow Exploration (AXL LN/CN) C; Target price of £0.30 per share: Executing on strategy: West Pepper adds ~6 mmcf/d production - The West Pepper well in Canada has been tied-in at initial stabilized natural gas production rates of 6.2 mmcf/d with no water production. This compares favourably with our expectations of 5.5 mmcf/d. With the additional production from the West Pepper Well, net corporate production is ~1,570 boe/d, almost tr
Companies: UKOG CEG HUR WEN SAVE PPC ALV ALV AXL CE1 CNE EME FEC IOG JSE TAL SDX
ADX Energy (ADX AU) C; Target price of A$0.040 per share: Raising new equity to advance Austrian projects -ADX has raised A$2.8 mm of new equity via a placement priced at A$0.01 per share. As part of the placement investors received one unlisted option for every two new placement shares with a strike price of A$0.015 per share and an expiry date by 30/06/2022. The proceeds from the funding will be used for (1) ongoing feasibility wor
Companies: ADX ALV ALV CE1 CNE COP COP ECHO EQNR EQNR GENL GTE IHC TAL RHC RHC SQZ TETY TETY TTE TXP
ADX Energy (ADX AU) C; Target price of A$0.045 per share: Independent prospective resources estimates – Prospective resources at the Anshof and OHO prospects have been independently estimated to hold respectively 6.6 mmboe and 17-24 mmboe with geological chance of success of respectively 43% and 24%. This is in line with the estimates previously provided by the company.
GeoPark (GPRK US) C; Target price of US$27 per share: Delivering
Companies: VLE TXP TLW SNM KOS GTE ADX AKRBP AKERBP ALV ALV DEC GPRK GPRK TETY TETY
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Companies: Savannah Energy Plc
Forecast and valuation update
Companies: IOG PLC
We are increasing our fair value estimate for Pantheon Resources to 208p, from under review (previously 184p). The change reflects what we believe was an unambiguously positive winter drilling campaign. This full note details the background analysis to the change in estimate of fair value, which includes a valuation table and an assessment of the forthcoming Alkaid#2 well.
Companies: Pantheon Resources plc
With several opportunistic but timely acquisitions in 2021, coupled with the recent surge in the oil price, Zenith Energy has, in our view, completely transformed itself and its value proposition to investors. While for various reasons it has not been easy for the market to fully recognise and reward this transformation, we expect 1) doubling production, 2) further strengthening of its balance sheet and 3) becoming Free Cash Flow (FCF) generative this year, will make it difficult for the market
Companies: Zenith Energy Ltd.
Alternative Resource Capital
Chariot has signed a front-end engineering and design (FEED) agreement with Schlumberger and Subsea 7 (the Subsea Integration Alliance) for the Anchois gas development project. Chariot and the Subsea Integration Alliance will adopt a “one team” integrated and collaborative approach to fast-track first gas from Anchois to maximise the return on investment for all stakeholders. The scope of work covers all the development's offshore elements including well completions and subsea production systems
Companies: Chariot Limited
AfriTin Mining (“ATM”) has announced another record-breaking quarter from Uis Phase 1. Tin production increased 13% QoQ to 152t for the three months to May (Q1 FY’23), supported by record recoveries, which along with cost initiatives drove a 16% improvement in All-In Sustaining Costs. The strong performance continues to support growth projects including incorporation of petalite lithium and tantalum by-products, upon which AfriTin recently announced positive drilling and metallurgical test work
Companies: AfriTin Mining Ltd.
RCS-1 flow testing results
Companies: Arrow Exploration Corp.
EQTEC has reached a key milestone in its Southport energy from waste project with the appointment of Anaergia as EPC and O&M partner. This is a complex project using multiple waste treatment solutions and we see EQTEC’s inclusion as a demonstration that it’s technology can combine with these to create an optimal outcome.
Companies: EQTEC PLC
Trinity has announced the commencement of its highly anticipated onshore drilling campaign. The Company's fully funded, six well drilling programme will target an aggregate 450-1,100mmbbls of reserves at a cost of US$14-17m. In addition to drilling four “conventional” low angle wells, Trinity will also drill one horizontal well and one deeper appraisal well, with both the horizontal and deeper appraisal wells having the potential to deliver substantially higher production and economic returns ve
Companies: Trinity Exploration & Production Plc
Wentworth has announced a positive operational update ahead of its AGM to be held later today. Daily production year-to-date (YTD) has averaged 92.2MMscf/d, a c15% YoY increase (2021: 79.9MMscf/d) and ahead of Wentworth's 2022 guidance of 75-85MMscf/d. As noted previously, the strong performance of the Mnazi Bay asset YTD has allowed Wentworth to increase its total dividend distribution in respect of 2021 to 1.7p per share, a yield of c7.1%. Mnazi Bay continues to supply Tanzania with half of th
Companies: Wentworth Resources PLC
• Section II of the Northern Peruvian Pipeline has been temporary re-opened.
• As a result, 0.72 mmbbl of PetroTal’s Bretana oil has been tendered at the Bayovar port by Petroperu for the July lifting. This oil previously entered the pipeline in late 2020 for which PetroTal was paid just ~US$45/bbl at the time.
• PetroTal will receive the difference between this price and the price at which Petroperu will sell the oil in July (~US$120/bbl), generating over US$60 mm of price adjustment true-up r
Companies: PetroTal Corp.
Wentworth has announced the acquisition of a 25% non-operated working interest in the Ruvuma PSA from Scirocco Energy for an initial consideration of US$3m plus contingent payments of up to US$13m. The consideration is structured to ensure that the majority is only paid in a success case, providing Wentworth with a low-cost entry point into a high growth opportunity. The transaction has the potential to nearly double the Company's production by 2026 and add over 190Bcf of 2P reserves on a Final
• 2022 YTD gross production was 92 mmcf/d, ahead of our expectations of 89 mmcf/d for 1H22.
• The FY22 production guidance remains unchanged at 75-85 mmcf/d. It looks very conservative in our view.
• The company currently holds US$26 mm in cash and no debt. This is in line with our expectations.
• TPDC continues to be current with regards to receivables.
• We re-iterate our target price of £0.45 per share.
Steady growth and dividend
Our Core NAV for the company based on its 2P reserves only i