CEQ CN, GPRK US, HHR AU, TETY SS, AKERBP NO, APA US, ALV CN, BP LN, CNE CN, DEC LN, DELT LN, DNO NO, EQNR NO, FEC CN, IOG LN, MAHA-A SS, SQZ LN, TTE FP, VAR NO
AUCTUS PUBLICATIONS________________________________________
Criterium Energy (CEQ CN) C; Resources report in Indonesia – The Lengo gas field is estimated to hold 359 bcf (134 bcf net to Criterium). The contingent resources for the Lengo field are contingent on signing a Gas Sales Agreement (GSA) and securing financing and a final investment decision (FID). A Heads of Agreement was signed in August 2022 with a credible gas offtaker and the partners are now progressing to a formal GSA. It is anticipated a GSA will be signed in 4Q23.
GeoPark (GPRK US)C: Target price of £0.45 per share: Reserves update. New discovery at Llanos-34 - GeoPark has reported YE22 2P reserves of 128.4 mmboe, down from 159.2 mmboe at YE21. This reflects FY22 production of 14.1 mmboe and ~17 mmboe of net negative revisions (technical + economic factors). Overall 3P reserves have been reduced from 248.3 mmboe at YE21 to 196.3 mmboe at YE22 including ~4 mmboe associated with the divestment of Argentina and ~34 mmboe on technical revisions + economic factors. In Colombia, the technical/economic factors represent a reduction of ~8 mmboe of 2P reserves and ~35 mmboe of 3P reserves. This reflects the auditor assuming (1) a lower recovery factor at Llanos-34 (38% vs 40% previously) and (2) a tighter delineation of the indico reservoir in CPO-5 field. The Guaco Sur exploration well at Llanos-34 has been tested at 976 bbl/d of 22 degrees API oil with 11% water cut from the Guadalupe formation. We have reduced our target price from US$31 to US$28 per share to reflect the reserves update.
See website for full report
Hartshead Resources (HHR AU)C; Target price of A$0.18 per share: Approved as operator – Hartshead has been approved as Sub-Area Operator to License P2607 covering blocks 48/15c, 49/11c, 49/12d, 49/17b and 49/6c by the UK North Sea Transition Authority.
Tethys Oil (TETY SS) C; Target price of SEK120 per share: >US$40 mm in net cash, 9% dividend yield, >120 mmbbl targeted by the drill bit in 2023 - Tethys held US$41.5 mm in cash and no debt at YE22. Tethys is embarking on a potentially transformational drilling programme in 2023. The company has disclosed for the first time prospective resources at Block 58, with 184 mmbbl (mean) estimated across three prospects in the Fahd area. The prospects cover multiple sands (Buah, Ara and Khufai), which increases the probability that each well will encounter oil. The most material sand is the Buah with ~100 mmbbl of prospective resources. The first well at Block 58 will be drilled in 3Q23. We assume Tethys will drill the 124 mmbbl Fahd South well with an unrisked NAV of SEK205/sh (>3x the current share price) assuming ~US$5/bbl. The chance of success associated with each individual sand is 18-24%. The resources targeted by this well represents ~5x Tethys’ current 2P reserves. The FY23 exploration capex at Block 58 is only US$10.5 mm. Tethys also plans to drill an exploration well in the Central Area of Block 56 in 3Q23 with 50 mmbbl prospective resources. Four exploration wells will be drilled at Blocks 3 & 4 including the Jari-1 well in the southern area of Block 4 that could open significant potential upside. The company will also re-enter and stimulate the Thameen-1 well at Block 49 (SEK36/sh unrisked). The profile of Tethys has significantly changed. While the dividend yield is ~9% (SEK5/sh to be paid in 2023), the total unrisked NAV of the company is now >SEK560/sh.
See website for full report
IN OTHER NEWS
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AMERICAS
88 Energy (88E AU/LN): Raising new equity – 88 Energy has raised A$17.5 mm at a price of A$0.0095 (£0.0055) per share. The proceeds will fund the Hickory-1 well at Project Phoenix in Alaska.
Alvopetro Energy (ALV CN): Operation update in Brazil - January sales volumes averaged 2,754 boe/d. The FY23 capex programme has been set at ~US$31 mm.
APA Corp (APA US)/TotalEnergies (TTE FP): Well update in Suriname – The test results of flow testing of the Sapakara South-2 appraisal well suggests that the well has encountered an incremental connected resource of more than 200 mmbbl of oil in place.
Canacol Energy (CNE CN): Operating update in Colombia – January gas sales were 185 mmcf/d.
Diversified Energy (DEC LN): Acquisition in the USA and issue of new equity – Diversified is acquiring 101 mmcfe/d of production and 25 mmboe of PDP reserves in the Central Region from Tanos Energy for US$250 mm. The acquisition will be funded by the issue of US$163 mm of new equity priced at £1.05 per share and a US$90 mm drawn down on the company’s existing debt facility.
EUROPE
Aker NP (AKERBP NO): 4Q22 results – The FY23 production guidance has been set at 430-460 mboe/d with US$3.0-3.5 bn capex, US$0.4-0.5 bn exploration spend and US$0.1-0.2 bn abandonment spend. The company is increasing its yearly dividend from US$2.0/sh in 2022 to US$2.2/sh in 2023. YE22 2P reserves were 1.86 bn boe.
BP (BP LN): 4Q22 results – 4Q22 adjusted net earnings were US$4.8 bn. The 4Q22 dividend has been increased by ~10% to 6.61 cts per share. FY22 production was 2,253 mboe/d. The organic reserves replacement ratio was 20% for the year. FY23 production is expected to be in line with FY22 with US$16-18 bn capex.
Deltic Energy 9DELT LN): Discovery in the UK – The Pensacola well is estimated to have encountered 302 bcf recoverable resources with 18.8 m of reservoir thickness and porosity of 16%. Post acidization, the well flowed gas at peak rates of ~4.75 mmcf/day declining to 1.75 mmcf/day after the 12 hours of the test. Being located down dip, the flow rates observed during the well test are not expected to be representative of flow rates of potential future production wells which would likely target the central part of the Pensacola structure and are expected to generate higher rates.
Equinor (EQNR NO): 4Q22 results – 4Q22 adjusted earnings were US$5.8 bn with 2,046 mboe/d production. Equinor is increasing its quarterly dividend per share by 50% to US$0.30 per share. In addition, the board proposes an extraordinary cash dividend of US$0.60 per share. The FY23 capex guidance has been set at US$17 bn to increase production by 3% in 2023. The annual average capex is estimated to average ~US$13 bn for 2024-2026. The US$1.2 bn share buy-back programme is being increased to up to US$6.0 bn in 2023.
IOG (IOG LN): Disappointing well performance in the UK – The remediation of the A2 well at Southwark reduced water production from 1,500 bbl/d to an average rate of 380 bbl/d. However, stabilised gas rates have been limited to 2.5 mmcf/d. These rates do not currently justify hooking up the well for production.
Serica Energy (SQZ LN): Operating update in the UK – FY22 production was 26,182 boe/d with 23,727 boe/d in January 2023. Net production from the Tailwind portfolio of assets has averaged 19,600 boe/d in January 2023. The FY23 production guidance including the Tailwind assets has been set at 40-47 mboe/d.
TotalEnergies (TTE FP): 4Q22 results – 4Q22 adjusted earnings were US$7.6 bn with 2,812 mboe/d production. The interim dividend is increased by >7% to EUR0.74 per share. Total is also launching a share buyback programme of US$2 bn for 1Q23. Excluding Novatek, hydrocarbon production is expected to increase by 2% in 2023 with US$16 18 bn capex.
Var Energi (VAR NO): Discovery in Norway – The Countach well in PL229 (Goliat), north-west of Hammerfest encountered oil in the Realgrunnen and Kobbe formations. A sidetrack is planned to better define the size of the discovery.
MIDDLE EAST AND NORTH AFRICA
DNO (DNO NO): 4Q22 results/Discovery in Norway – FY22 production in Kurdistan was 80.7 mbbl/d. Net production in Norway and Cote d’Ivoire was respectively 13.3 mboe/d and 3.3 mboe/d. The Rover exploration well in Norway encountered 17-47 mmboe recoverable resources. Net cash at YE22 was US$388 mm. The company is launching a share buyback programme for up to 5% of its share capital. Gross production at the Tawke licence is expected to stand at 100 mbbl/d in 2023. Net production in Norway is forecasted at 12-13 mboe/d. FY23 overall capex is estimated at US$395 mm. The company has announced a quarterly dividend of NOK0.25 per share.
Maha Energy (MAHA-SS): Reserves and resources update in Oman and the USA – WI 2P reserves at YE22 were estimated at 2.74 mmbbl. 32 mmbbl 2C resources were estimated in Oman.
EVENTS TO WATCH NEXT WEEK
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14/02/2023 – Repsol (REP SM): FY22 results
14/02/2023 – Var Energi (VAR NO): FY22 results and Capital Market Day
Aker BP ASA engages in the exploration, development, and production of petroleum resources on the Norwegian Shelf. In addition, Co. has a separate Johan Sverdrup business unit to manage its interest.
Alvopetro Energy is a resource company and is engaged in the exploration for, and the acquisition, development and production of, hydrocarbons in the Reconcavo, Tucano, Camamu-Almada and Sergipe-Alagoas basins in onshore Brazil. Co. develops producing hydrocarbons by appraising and developing existing discoveries and exploring in areas considered by management to be prospective for hydrocarbon resources. Co.'s assets consist of interests in three producing fields and 16 exploration blocks comprising 148,500 gross acres onshore Brazil.
Apache is an independent energy company that explores for, develops, and produces natural gas, crude oil, and natural gas liquids. The company had exploration and production operations in United States, Egypt, and offshore United Kingdom in the North Sea. The company also has exploration interests in Suriname. The company markets its United States crude oil production to main oil companies, marketing, and transportation companies, and refiners based on a West Texas Intermediate price or other regional pricing indices. The company has two international regions: The Egypt includes onshore conventional assets in Egypt's Western Desert. The North Sea region includes offshore assets based in United Kingdom.
BP is an integrated oil and gas group based in the United Kingdom. Co. is engaged in the exploration and production of crude oil and natural gas; refining, marketing, supply and transportation; and the manufacture and marketing of petrochemicals. Co. operates globally, with business activities in Europe, the U.S., Canada, Russia, South America, Australasia, Asia and parts of Africa. Co. operates in two business segments: Exploration and Production - including oil and natural gas exploration and development and production; and Refining and Marketing- activities include the refining, manufacturing, supply and trading, marketing and transportation of crude oil, petroleum and petrochemicals.
Canacol Energy is engaged in core petroleum and natural gas exploration and development activities in Colombia, Brazil and Guyana.
Cluff Natural Resources invests in global resources opportunities with a primary focus on U.K. based upstream energy projects. Co.'s principal activity is the exploration, evaluation and development of mineral exploration targets. As of Dec 31 2016, Co. held a 100% interest in two gas licenses in the Southern North Sea.
Diversified Gas & Oil is an Appalachian Basin focused natural gas and crude oil operations company.
DNO is a Norwegian exploration and production company focused on the Middle East and North Africa. Co. holds stakes in oil and gas blocks in various stages of exploration, development and production, both onshore and offshore, in the Kurdistan region of Iraq, Yemen, Oman, the United Arab Emirates, Tunisia and Somaliland.
Equinor is engaged in oil and gas exploration and production activities. Co. is primarily focused on exploration, development and production of oil and gas on the Norwegian continental shelf (NCS). Co.'s operations are organized into four segments. The Development and Production Norway and Development and Production International segments explore, develop, produce and extract crude oil, natural gas and natural gas liquids. The Marketing, Processing and Renewable Energy segment markets, trades, transports and processes oil and natural gas and renewable energy. The Other segment consists of global well and project delivery, research and develpoment, and business development.
Frontera Energy is a publicly traded oil and gas company engaged in the exploration, development and production of heavy crude oil and natural gas in Colombia, Peru, Brazil, and Guatemala.
Independent Oil and Gas, through its subsidiaries, is engaged in the business of oil and gas exploration and/or operations in the North Sea. Co. has its oil and gas interests are in the U.K. sector of the North Sea.
Maha Energy AB is a Sweden-based independent, international upstream oil and gas company whose business activities include exploration, development and production of crude oil. It directly operates through Maha Energy Inc in Canada, as well as Maha Energy 1 [Brazil] AB and Maha Energy 2 [Brazil] AB in Sweden. It owns an oil field in Wyoming, the United States. The Company specializes in primary, secondary and enhanced oil and gas recovery technologies, and operates a technical office in Calgary and Alberta in Canada, as well as an operations office in Newcastle and Wyoming in the United States. The Company operates as wholly-owned subsidiaries Gran Tierra Finance (Luxembourg) SARL and Gran Tierra Brazco (Luxembourg) SARL.
Serica Energy is an independent oil and gas company with production, development and exploration licence interests in the U.K. Continental Shelf and exploration interests in Ireland, Morocco and Namibia. As of Dec 31 2016, Co. had proved plus probable reserves of 3.8 million barrels of oil equivalent, which consisted of 2.1 million barrels of oil and 10.40 billion cubic feet of gas.
Tethys Petroleum is an oil and gas exploration and production company focused on projects in Central Asia. Through its subsidiaries, Co. is engaged in the exploration for, and the acquisition, development and production of, oil and natural gas resources in Kazakhstan, Tajikistan and Uzbekistan.
Total is an international integrated oil and gas company also active in solar and biomass energy sources. Co. engages all aspects of the petroleum industry, including Upstream operations (oil and gas exploration, development and production, and LNG (Liquefied Natural Gas)) and Downstream operations (refining, petrochemicals, specialty chemicals, marketing and marketing and trading and shipping of crude oil and petroleum products). In addition, Co. is engaged in the coal mining and power generation sectors. Co.'s worldwide operations are conducted through three business segments: Upstream, Refining & Chemicals, and Marketing & Services.
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.
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