AUCTUS ON FRIDAY - 16/05/2025

AUCTUS PUBLICATIONS
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Chariot (CHAR LN)C: Recovering 75% WI of licences in Morocco – Energean has returned its Moroccan offshore interests to Chariot. As a result, Chariot now holds 75% in the Lixus Offshore and Rissana Offshore licences.

Condor Energies (CDR CN)C; Target price of C$5.90 per share: Acquiring a LNG facility for Kazakhstan to deliver first LNG sale in 2Q26 – 1Q25 production in Uzbekistan was 11,179 boe/d (+6% vs. production in 4Q24). Condor held ~C$33 mm in cash at the end of March, supported by a C$10.7 mm positive working capital movement in 1Q25. The accounts receivable balance decreased by C$9.4 mm since YE24, demonstrating consistent payments in Uzbekistan. The highlight of the press release is the progress achieved at the first LNG plant in Kazakhstan. In May, Condor purchased a 80,000 t per day modular LNG facility for the Saryozek plant site for US$6.5 mm - with US$1.5 mm due in 10 days and the balance paid upon milestones. Fabrication remains on track for completion in 4Q25, with first LNG sales anticipated in 2Q26. The additional cost to complete and commission the facility is estimated at US$18.6 mm. In April, Condor secured its third natural gas allocation. This allocation will be for the first LNG facility. The allocation can support the tripling of the size of the Saryozek facility (to 240,000 t per day). The finalization of the LNG offtake agreement is expected in the coming weeks. Its completion would unlock financing for facility construction, accelerating project execution. Incorporating the progress at Kazakhstan’s first LNG plant, we raise our target price from C$5.70 to C$5.90 per share, in line with our new ReNAV. This marks a major milestone in unlocking the value of Condor’s business. Our unrisked NAV for Condor’s LNG assets (Saryozek, Alga expected to start production in 2Q27 with FID in 4Q25 and Kuryk) exceeds C$8.00 per share. This assumes a capacity of only 80,000 t per day at Saryozek — offering further upside should capacity reach 240,000 t per day.
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Corcel (CRCL LN)C; Target price of 1.50 pence per share: Material increase in KON-16 and subsequent farm-out to Sintana Energy (SEI.V CN) – Corcel has agreed to acquire a net 27% additional stake in KON-16 (onshore Angola) from Intank for US$0.5 mm in cash. As part of the deal, Intank will receive a 5% overriding royalty on the first development area. Corcel has subsequently agreed terms to divest a 5% net interest in KON-16 to Sintana Energy for US$2.5 mm in cash. In addition, Sintana will receive a 2.5% net profit interest on Corcel’s share of KON-16 until reaching US$50 mm, after which the net profit interest reduces to 1.5%. KON-16 remains Corcel’s flagship asset, with its net interest increasing from 49.5% to 71.5%. This expansion raises WI unrisked prospective resources from ~200 mmbbl to ~285 mmbbl. The two transactions are cash accretive, providing an additional US$2 mm in net funding, which reduces potential dilution at the corporate level. We have increased our target price of from 1.00 pence per share to 1.50 pence per share, reflecting the transactions’ impact. The transaction with Sintana values Corcel’s 71.5% in KON-16 at ~US$36 mm (based on US$2.5 mm for 5%). This represents 2.3x the current market cap of Corcel of 0.5 pence per share. A new Competent Person Report (CPR) with independent prospective resource estimates for KON-16 is expected in early 3Q25. Additionally, Corcel plans to acquire 300-line km of 2D seismic to refine imaging of both shallow post-salt and deeper pre-salt targets. Successful drilling of a post-salt target at KON-16 (~100 mmbbl) in Angola, could add ~1.60 pence per share, with a further unrisked value of 4.85 pence per share for the pre-salt target (~300 mmbbl).
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Criterium Energy (CEQ CN)C; Target price of C$0.35 per share: Stepping on the gas – The staged development of gas discoveries at Tungkal is the primary driver of near-term growth. Assuming flat oil production, bringing just two gas discoveries online could enable Criterium to triple output to ~3 mboe/d and triple 2P reserves by early 2027 The first discovery to be developed, SE MGH (15 bcf 2C resources), is expected to see resource conversion to reserves in 2025. In early 3Q25, the existing well—previously tested at 8 mmcf/d—will be re-tested, with initial production of 5-7 mmcf/d anticipated by 1Q26. Capex to first gas is estimated at US$3-5 mm, with the 14 km pipeline to the existing facility funded by the off-taker in exchange for a small gas transportation fee. This initial development is forecast to generate ~US$6 mm FCF per year and, due to fixed gas prices, FCF remains insulated from oil price fluctuations, equating to 1.2-2x the initial capex annually. In 2026, Criterium will advance Macan Gedang (12.6 bcf), situated 15 km from SE MGH, with similar development capex. Production is slated to commence late 2026 or early 2027, with the well previously tested at ~5 mmcf/d. Three more gas discoveries, scheduled for testing by YE26, could contribute an additional 3 mboe/d to 6 mboe/d (assuming comparable IPs). (i) Four wells at North MGH were shut-in in 2014 due to high GOR. (ii) Drilled in 2025, the MGH-43 infill well encountered gas in the Gumai formation. Resources for these two opportunities have yet to be estimated. (iii) Criterium plans to re-enter or twin the Cerah-1 well. The prospect is estimated to hold 26.2 bcf P50 prospective resources. The NW Cerah and Berkas prospects could add another 24.8 bcf (best case).
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New Zealand Energy (NZ CN)C: Restructuring convertible bond – The C$2 mm existing convertible loan will be cancelled. In return New Zealand will pay C$0.5 mm to the loan holder and issue 1 mm new shares.

PetroTal (PTAL LN/TAL CN)C; Target price of £1.20 per share: Good balance sheet. Resilient to low oil price – 1Q25 production and net cash at the end of March had been previously announced. PetroTal maintains a solid financial position with US$116.6 mm in cash. Additionally, the company has secured a term loan with a syndicate of Peruvian banks, with commitments of up to US$65 mm to finance the erosion project at Bretana. The interest rate is 8.65%; which compares favourably with other credit options available to the company. The loan terms do not impose any material restrictions on PetroTal’s ability to distribute dividends to shareholders. If Brent remains at current levels until August, PetroTal may decide to scale back its capital program. As PetroTal owns its rig, it retains full flexibility in determining the new well count. Given the high IP of new wells, a strong oil price in the first month of production has a disproportionate impact on NPV. April production averaged ~23 mbbl/d, in line with March levels, despite pump failures in four wells (out of 24), which curtailed ~4 mbbl/d. Export capacity remains the key production driver. The failed pumps will be replaced using a work-over rig in 3Q25. At the current share price, the expected FY25 dividend yield is ~ 16%.
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Pharos Energy (PHAR LN)C; Target price of £0.45 per share: High impact drilling in Vietnam in 4Q25. Lower capex than expected – Production from January to April 2025 was 5,757 boe/d, comprising 4,216 boe/d from Vietnam and 1,541 bbl/d from Egypt. This is consistent with the FY25 production guidance of 5.0-6.2 mboe/d, which has been reaffirmed. In Egypt, receivables increased from US$29.5 million at year-end 2024 to US$31.7 mm by the end of April. However, the company has received US$4.9 mm from EGPC over the same period. Pharos held US$22 mm in cash at the end of April, in line with our expectations. The FY25 capex guidance has been narrowed from US$37–66 mm to US$33-40 mm, with an additional US$17 mm allocated for early 2026. This adjustment reflects lower rig rates, cost reductions at Blocks 125 & 126, and a scaled-down drilling program in Egypt, reducing the planned wells from ten to four. The key near term newsflow remains the drilling programme in Vietnam. The four well infill development programme (three wells at TGT and one at CNV) could boost Vietnam production by ~20% in 2026 compared to 2025. Additionally, six more development wells and further continuation of production beyond the current license expiry date at TGT could bring 5.5 mmboe of 2C contingent resources into production. Success at the 18X appraisal well (TGT), could add 1–3 mmboe of reserves in the western area of the field. Meanwhile, the 5X appraisal well at CNV could extend production into the northern part of the field. Overall, the contingent and prospective resources in Vietnam represents over 100% of the company existing 2P reserves in that country. As we reduce our oil price assumptions for 2Q25 and 3Q25 from US$75/bbl to US$65/bbl and delay production growth in Egypt by one year from 2026 to 2027, we have changed our target price to £0.45 per share. See website for full report

Sintana Energy (SEI.V CN)C; Target price of C$1.80 per share: Adding high impact exploration onshore Angola – Angola from Corcel for US$2.5 mm. In addition, Sintana will receive a 2.5% net profit interest on 71.5% of KON-16 until reaching US$50 mm, after which the net profit interest reduces to 1.5%. There are multiple post-salt (shallow) and pre-salt (deeper) prospects that were highlighted by 2010 2D seismic. The pre-salt prospects are analogous to what is being developed offshore with significantly lower cost. Corcel, plans to drill the first exploration well in 2026 targeting both a post-salt (~100 mmbbl) and a pre-salt (~300 mmbbl) prospect. A 1960s well encountered oil at the edge of the pre-salt target, significantly de-risking it by demonstrating a working hydrocarbon system beneath the salt. An exploration well costs ~US$20 mm (gross).
See website for full report

Southern Energy (SOUC LN/SOU CN)C; Target price of £0.25 per share: Taking measures to resolve a long standing pipeline tariffs dispute – In 3Q23, a new midstream operator significantly raised pipeline fees on Mechanicsburg and Green’s Creek production (~400 boe/d), prompting Southern to challenge the increase as excessive and well above Federal Energy Regulatory Commission (FERC) guidelines. Despite efforts to reach an agreement, negotiations were unsuccessful. However, following a lengthy FERC enforcement investigation into the pipeline operator, Southern is now in a position to escalate the issue toward resolution. In April, the FERC confirmed that the pipelines under dispute fall under their regulation, meaning tariffs must comply with federal guidelines. In response, the midstream operator further increased tariffs to the maximum allowable rates, subject to FERC approval. Southern has opted to shut in its 400 boe/d production at Mechanicsburg and Green’s Creek until the FERC issues its final ruling. The maximum determination timeline is 150 days, although if either party disputes the outcome, they can request a full judicial review, extending the process by an estimated additional 4-6 months. Even if production remains offline for 150 days, Southern has sufficient financial resources to proceed with its high-impact, 3-well completion program at Gwinville by late 2Q25, as this field is unaffected by the dispute. However, the issue may cause a 1-2 month delay for the planned two-well Mechanicsburg drilling campaign. In such a scenario, Southern would likely prioritize drilling Williamsburg instead. The Gwinville Lower Selma Chalk and City Bank formations offer an unrisked upside of £0.20 per share, while Williamsburg’s unrisked NAV stands at £0.23 per share—highlighting these areas as primary growth drivers.
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Vaalco Energy (EGY US/LN)C; Target price of US$10.00 per share: Good balance sheet. Flexible capex – 1Q25 WI production of 22,402 boe/d was at the high end of expectations. The Ebouri well continues to produce at ~1 mbbl/d (gross) on test. Cash flow from operations was US$32.7 mm, while capex of US$58 mm came in below projections. Underlying cash flow was even higher, at ~US$41 mm. Additionally, one lifting in Gabon (~US$30 mm) was allocated to the Gabonese State as its share of profit oil, with no further allocations expected for the remainder of 2025. At the end of March, Vaalco reported US$40.9 mm in cash, alongside a US$190-300 mm revolving credit facility, strengthening financial flexibility beyond our expectations. The FY25 production guidance (19.3-22.3 mboe/d) has been reaffirmed, while capex guidance has been reduced from US$270-330 mm to US$250-300 mm, primarily due to deferred Canadian drilling. Drilling in Gabon remains scheduled for 3Q25, with Côte d’Ivoire set to resume production in 2026.Vaalco has three large projects planned for parallel execution in 2026, namely drilling in CI and Gabon and development in EG. The company's financial framework (capex and dividend) is based on US$60-65/bbl Brent. At the individual project level, EG—despite being a greenfield project with the lowest returns—remains profitable at US$55/bbl Brent. The three key projects operate under a PSC regime with high cost stops (70%-85%), ensuring that most of the revenue is initially allocated to Vaalco, making these projects highly resilient to lower oil prices. The dividend yield is currently ~7.2%. With significantly higher production expected from 2026 onwards, we forecast ~39 mboe/d output by 2028, marking 2025 as a pivotal year for the company's growth trajectory.
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Valeura Energy (VLE CN)C; Target price of C$13.00 per share: FID at Wassana adds 8.6 mmbbl 2P reserves – The 1Q25 production and cash position at the end of March were in line with previous indications. However the adjusted working capital was ~US$15 mm higher than cash given an oil inventory increase of 0.89 mmbbl. Valeura has taken FID at Wassana (G10/48 licence), resulting in the conversion of 8.6 mmbbl 2C contingent resources into 2P reserves. Wassana’s 2P reserves now stand at 20.5 mmbbl, with the field expected to produce 10 mbbl/d in 2H27, representing almost 45% of FY24 production. The licence holds an additional 6.2 mmbbl 2C contingent resources linked to the Nirami Field (north) and Mayura discovery (south), both potential satellite developments for Wassana. In total, Wassana’s combined 2P reserves + 2C resources now amount to 26.7 mmbbl, improving upon the previous estimates of 12.9 mmbbl 2P reserves + 10.6 mmbbl heavy oil 2C resources (total: 23.5 mmbbl). As we incorporate the new reserves and resources, we raise our target price from C$12 to C$13 per share. Wassana’s redevelopment will extend the duration of plateau production and establish a new anchor infrastructure to support future regional developments. Given its low capex, low opex, and high IRR, the project enhances the resilience of the business in a low oil price environment. Even accounting for the new development capex, we project Valeura’s net cash position to exceed the current market cap by early 2028.
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Zephyr Energy (ZPHR LN)C; Target price of £0.15 per share: Private equity funding unlocks growth in the Williston and provides external validation – Zephyr has secured a US$100 mm drilling funding agreement with a US private equity firm to enable growth in its non-operated asset portfolio in the Williston Basin. The structure appears to be similar to a “DrillCo”, in which the investor will fund up to 100% of Zephyr’s drillex on a case by case basis. The agreement covers drilling on future well acquisitions but also could apply to new wells proposed on the Zephyr’s existing acreage. The funding should enable Zephyr to scale production in a highly cost effective manner. With its current land position, Zephyr consistently receives AFEs for new wells, and the investor has potential to fund those developments going forward in an accretive manner for Zephyr. As oil prices have declined, valuation expectations have also dropped, creating attractive acquisition opportunities. Several acreage holders are looking to exit their commitments, while OFS companies have lowered service costs, improving project economics. This agreement serves as an external validation of Zephyr’s strategy and expertise in the Williston Basin. Notably, following the US$6 bn merger of Whiting Petroleum and Oasis Petroleum, several key personnel chose to join Zephyr rather than relocate to the combined entity’s headquarters in Houston. Zephyr’s funding partner has an in-house upstream oil and gas technical team, offering an additional layer of expertise to screen investment opportunities and further enhance project selection.
See website for full report

IN OTHER NEWS
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AMERICAS

Diversified Energy (DEC US/LN): 1Q25 results – 1Q25 production in the USA was 144 mboe/d with a March exit rate of 192 mboe/d. FY25 production is expected to average 175-183 mboe/d. Net debt at the end of March was US$2.6 bn.

Frontera Energy (FEC CN): 1Q25 results – 1Q25 production in Colombia and Ecuador was 40,477 boe/d. Net debt at the end of March was US$306 mm.

GeoPark (GPRK US)C: Acquisition in Argentina not proceeding – Phoenix Global Resources has decided to withdraw from the agreement to sell interests in licences in the Vaca Muerta. As a result, the acquisition will not be completed by GeoPark.

Touchstone Exploration (TXP LN/CN): 1Q25 update – 1Q25 production in Trinidad was 4,317 boe/d (4Q24: 5,287 boe/d) as natural declines are only partially offset by new drilling. Production in April has further declined to 3,628 boe/d. Net debt at the end of March was US$33.3 mm (US$29.1 mm at YE24).

ASIA AND AUSTRALASIA

Empyrean Energy (EME LN): Disappointing well results – Wilson River-1 well flowed only water on test.

EUROPE

CanCambrian Energy (CCEC CN): Resources update in Hungary –2C contingent resources at the Kiskunhalas tight-gas project are estimated at 627.4 bcf of natural gas and 66.5 mmbbl of condensate.

MIDDLE-EAST AND NORTH AFRICA

DNO (DNO NO): 1Q25 results – 1Q25 net production in Kurdistan, Ivory Coast and Norway was 84.2 mboe/d. In Norway, the company has encountered 26 mmboe recoverable resources across two discoveries during the period. Net cash at the end of March was US$43 mm.

Serinus Energy (SENX LN): 1Q25 results – 1Q25 production in Tunisia and Romana was 481 boe/d. The company had a working capital deficit of US$8.2 mm at the end of March.

SUB-SAHARAN AFRICA

Africa Oil (AOI SS/CN): 1Q25 results – 1Q25 WI production in Nigeria was 33.4 mboe/d. Net debt at the end of March was US$192 mm. The company is changing its name to Meren Energy Inc. (MER SS/CN)

Orca Energy (ORC.A/B CN): 1Q25 results – The Songas power plant in Tanzania remains shutdown. 1Q25 gas sales in Tanzania were 72 mmcf/d. Orca held US$26.8 mm in working capital at the end of March.

Tullow Oil (TLW LN): Selling Gabon – Tullow signed a SPA to sell its Gabonese assets to Gabon Oil for US$300 mm net to taxes. The signature of a MOU had been announced previously.

EVENTS TO WATCH NEXT WEEK
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20/05/2025 –Nostrum Oil & Gas (NOG LN): 1Q25 results
21/05/2025 – Panoro Energy (CDR CN): 1Q25 results
22/05/2025 – Serica Energy (SQZ LN): AGM