Auctus on Friday - 03/11/2023
AUCTUS PUBLICATIONS________________________________________
ADX Energy (ADX AU)C; target price of A$0.80 per share: On Track to start drilling in early November - 3Q23 production of 324 boe/d and cash of A$5.7 mm at the end of September were near our expectations. This includes 101 bbl/d gross production for Anshof that was shut-in on 19 September after reaching the regulatory limit for test production. Until that date the Anshof-3 well produced at a stable rate of 114 bbl/d, which is above the company’s initial expectations. Anshof-3 production will recommence after the drilling of the Anshof-2 well and the installation of a permanent production facility in February. Drilling of the Anshof-2 well continues to be expected to commence in early November while Anshof-1 could spud in 2Q24. Long lead items for Anshof-1 are expected to be delivered in November. We forecast ~700 bbl/d net production at YE24 based on Zistersdorf plus three Anshof wells. Welchau-1 drilling operations continue to be expected to commence in late November to mid-Decembe,r subject to an environmental permit expected in early November. Ahead of finalizing a farm-out with MND (terms already agreed) for one gas prospect on licence ADX-AT-I, ADX has started the drilling permitting process for three locations on the licence. It is expected that the first drilling permit including the environmental permit will be issued in November. Drilling is expected to start in 3Q24.
See website for full report
Calima Energy (CE1 AU)C; target price of A$0.45 per share: High production in 4Q23 and 1Q24 - 3Q23 production was 3,683 boe/d, slightly below the company’s guidance due to maintenance, turn-around operations at two of the production facilities and unscheduled downhole maintenance on pumping equipment on a few of the more productive wells. We forecasted 3,890 boe/d. This is more than offset by the high current production of ~4,100 boe/d following Pisces 10 and 11 being brought into production. Pisces 11 continues to clean up with Pisces 12 due to commence production in November. Calima forecasts 4Q23 production of 4,028 boe/d and we have increased our 4Q23 production forecast of 3,740 boe/d to 4,030 boe/d to be in line with Calima’s guidance. 1Q24 production is expected to remain ~4.1 mboe/d, which is also above our previous forecast of 3.9 mboe/d.
See website for full report
Chariot (CHAR LN)C; target price of £0,50 per share: EIA awarded at Anchois. Imminent partner on track - Chariot has received approval for its Environmental Impact Assessment (EIA) for the Anchois project. The EIA covers all aspects of the development including future wells and offshore infrastructure, the onshore Central Processing Facility and the link to the GME pipeline. This is an important step that derisks the project further. We understand that negotiations on partnering are in the final stages. A partner could be announced very soon. The drilling campaign at the Loukos onshore permit continues to be expected to start in early 2024.
See website for full report
Southern Energy (SOUC LN/SOU CN)C; target price of £1.20 per share: Raising equity to grow production -Southern has raised ~US$5 mm of new equity at a price of 15.5p per share to boost the balance sheet to fund the completion of four drilled and uncompleted (DUC) wells at Gwinville and grow production to 4.7 mboe/d in 2Q24 from 2.8 mboe/d in 3Q23. We had previously assumed that the completion of these DUCs would have been funded with the credit facility. The credit facility would have been fully drawn under these conditions. The proceeds of the equity raise allow the company to keep a liquidity buffer. In the context of higher gas prices, the increased cashflow from higher production should provide funding for further drilling that will in turn boost production further. Southern is rebidding completion services for its DUCs and preliminary indications suggest prices lower than recent tenders. This could have important implications for the overall cost of the completion programme that is now estimated at ~US$12 mm (we previously estimated US$15 mm) and for the subsequent drilling programme. As we incorporate the impact of the financing, we have changed our target price to £1.20. Southern continues to be a play on the recovery of US gas prices.
See website for full report
Zephyr Energy (ZPHR LN)C; target price of £0.16 per share: Operational update in the USA – The six recently acquired Slawson wells are scheduled to be brought online 1 November. Following the completion of the RCF redetermination process, the borrowing base remains US$13 mm, the level at which it is currently drawn. No value was ascribed to the new Slawson production during the redetermination process (due to production not commencing during the evaluation period), but Zephyr does expect that the newly commenced Slawson production will allow for a significantly enhanced borrowing base once production is established.
IN OTHER NEWS
________________________________________
AMERICAS
88 Energy (88E LN/88E AU): 3Q23 update in Alaska and the USA – 3Q23 production was 335 boe/d gross. 88 held A$10.2 mm in cash at the end of September.
ExxonMobil (XOM US): Discovery in Guyana – The Lancetfish-2 well (Liza licence) has encountered ~20 metres of hydrocarbon-bearing reservoir, with ~ 81 metres of additional hydrocarbon-bearing sandstone.
Gran Tierra Energy (GTE CN/US/LN): 3Q23 results – 3Q23 WI Production in Colombia was 33,940 bbl/d. Net debt at the end of September was US$499 mm.
ASIA PACIFIC
Upland Resources (UPL LN): No more take-over approach – Subsequent to the Offer Period beginning, the potential acquirer did not engage and failed to sustain communications with Upland. Further investigation and evidence eventually led to the conclusion that the potential acquirer was not bona fide. The Offer Period has been terminated.
EUROPE
BP (BP LN): 3Q23 results – 3Q23 adjusted earnings were US$3.3 bn with 2,310 mboe/d production. 4Q23 production is expected to be similar to 3Q23. FY23 capex is forecasted at US$16 bn.
OMV (OMV AG): 3Q23 results – 3Q23 adjusted net income was EUR431 mm with production of 364 mboe/d. The company anticipates producing 360 mboe/d in 2023 with overall capex of EUR3.8 bn.
Shell (SHEL LN): 3Q23 results – 3Q23 net adjusted income was US$6.2 bn with 2,653 mboe/d production. Shell announced a new share buyback programme of US$3.5 bn which is expected to be completed by the 4Q23 results announcement. FY23 capex is estimated at US$23-25 bn with 4Q23 production of 2,620-2,880 mboe/d.
Trillion Energy (TCF CN): Operation update in Turkey – Total gross combined production at SASB is currently 14.4 mmcf/d.
Union Oil & Gas (UOG LN): Terminating farm-out transaction in the UK – The farm-out transaction of the Maria discovery to Quattro Energy has been terminated. The current phase of the licence expires on 30 November and a firm commitment to drill a well in the next phase of the licence is required to continue the Licence beyond this date. United has made the decision not to apply to move into the next phase of the Licence.
FORMER SOVIET UNION
Caspian Sunrise (CASP LN): Operating update in Kazakhstan – The discount for oil produced in Kazakhstan and sold internationally via the Russian pipeline network has narrowed from the initial US$35/bbl to ~US$10/bbl. A pipe continues to be stuck in Well 802 and could not be removed. After Well 803, it is unlikely any further deep wells will be drilled at the BNG Contract area. Production is ~2,000 bbl/d.
Chevron (CVX US): Cost increase in Kazakhstan – The cost of the US$45 bn Tengiz project in Kazakhstan will rise by about 4%.
MIDDLE EAST AND NORTH AFRICA
SDX Energy (SDX LN): Well test results in Morocco – The KSR-21 well delivered a flow rate of approximately 4 mmcf/d during the test period.
SUB-SAHARAN AFRICA
Invictus Energy (IVZ AU): Further gas shows in deeper reservoir – The Mukuyu-2 well has now reached TD at 3,718 m. The well has encountered a total gross hydrocarbon charged interval across Upper and Lower Angwa in excess of 1,000 m. The well will now be logged.
Seplat Energy (SEPL LN): 3Q23 results – WI production in Nigeria from January to September 2023 was 48,152 boe/d. Total production deferment in the period was 31%. On the Eastern operations in OML 53, production was negatively impacted by issues with the Antan-Ebocha delivery line. These were resolved in August allowing the resumption of the production from the Jisike operations. Net debt at the end of September was US$347 mm. The FY23 production guidance has been narrowed to 46-50 mboe/d, at the lower end of the original guidance range of 45-55 mboe/d. The FY23 capex guidance has also been narrowed to US$160-180 mm. The ANOH project is now expected to be completed in 1Q24 with a first gas target of 3Q24. Dividend streams net to Seplat of ~US$30 mm per annum are expected ~ 12-18 months after first gas.
EVENTS TO WATCH NEXT WEEK
________________________________________
06/11/2023: Kosmos Energy (KOS US/LN) – 3Q23 results
07/11/2023: GeoPark (GPRK US) – 3Q23 results
07/11/2023: Tethys Oil (TETY SS) – 3Q23 results
07/11/2023: VAALCO Energy (EGY US/LN) – 3Q23 results
09/11/2023: DNO (DNO NO) – 3Q23 results
09/11/2023: Frontera Energy (FEC CN) – 3Q23 results
09/11/2023: Canacol Energy (CEN CN) – 3Q23 results
Calima Energy and its subsidiaries are engaged in investing in oil and gas exploration and production projects internationally and more specifically in West Africa.
Caspian Sunrise is engaged in exploration and production of crude oil. Co. builds a portfolio of oil and gas exploration and production assets in Central Asia and in particular Kazakhstan.
Chariot Oil & Gas is an independent oil and gas exploration company focused offshore in West Africa with a portfolio of assets located in the under-explored regions of Namibia, Mauritania and Morocco.
Chevron is engaged in energy and chemicals operations. Upstream operations consist primarily of, among others, exploring for, developing and producing crude oil and natural gas; processing, liquefaction, transportation and regasification associated with liquefied natural gas, storage and marketing of natural gas; and a gas-to-liquids plant. Downstream operations consist primarily of, among others, refining crude oil into petroleum products; marketing of crude oil and refined products; and manufacturing and marketing of commodity petrochemicals, plastics for industrial uses and fuel and lubricant additives.
Exxon Mobil operates or markets products in United States and other countries through its divisions and affiliated companies. The company's business involves exploration for, and production of, crude oil and natural gas and manufacture, trade, transport and sale of crude oil, natural gas, petroleum products, petrochemicals and other products. In United States, the company's development activities are focused on the onshore United States, in the Permian Basin of West Texas and New Mexico and the Bakken oil play in North Dakota. Gas development activities are also focused on the Marcellus Shale of Pennsylvania and West Virginia, the Utica Shale of Ohio and the Haynesville Shale of East Texas and Louisiana.
Gran Tierra Energy, together with its subsidiaries, is a company focused on oil and gas exploration and production in Colombia. Co. is primarily engaged in the exploration and production of oil and natural gas. Co. has one reportable segment based on geographic organization, Colombia. As of Dec 31 2017, Co. had total estimated proved reserves of 59.3 million barrels of oil and natural gas equivalent, consisting of 58.9 million barrels of oil and 2.1 million cubic feet of natural gas.
Invictus Energy is engaged in the evaluation and exploration of coal bed methane (CBM) and unconventional gas in southern Africa.
OMV is an international energy company with activities in Exploration and Production (E&P), Refining and Marketing including petrochemicals (R&M), and Gas and Power (G&P). Co. explores and develops oil and gas resources and supply energy to over 100 million people. OMV has three operating segments: Exploration and Production (E&P), Refining and Marketing, including petrochemicals (R&M), and Gas and Power (G&P), as well as the segment Corporate and Other (Co&O).
SDX Energy is engaged in the exploration, acquisition, development and production of oil and natural gas in Africa and Egypt. As of Dec 31 2010, total gross proved reserves for light and medium oil consisted of 3,593 thousand barrels ("mbbls"), natural gas liquids consisting of 211 mbbls and natural gas consisting of 2,575 million cubic feet.
Rose Petroleum is an oil and gas (O&G) and mining company with exploration assets and an operational crushing and flotation mill. Co.'s principal activities are the exploration and development of O&G resources together with the evaluation and acquisition of other mineral exploration targets, principally gold, silver, uranium and copper, and the development and operation of mines in Mexico. In Co.'s O&G division, the area of focus is on two unconventional oil and gas basins in the U.S.: the Uinta Basin and the Paradox Basin. In its mining division, Co. continues its milling operations through its subsidiary, Minerales VANE S.A. de C.V., which owns the SDA Mill in Mexico.
Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector.
The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy.
Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors.
Auctus provides Corporate Broking, Equity Research and Investment Banking services.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.