AUCTUS ON FRIDAY - 28/11/2025

Arrow Exploration (AXL LN/CN)C; Target price of £0.40 per share: Another positive result at Mateguafa Attic – The M-6 vertical well has encountered 30 ft of net oil pay in the Carbonera C9 formation (previously named Guadalupe). This compares favourably with the results of the M-5 well that encountered ~ 26 feet of net oil pay in the same formation. This result provides a strong foundation for the first horizontal well at Mateguafa (M-HZ7), already spudded and expected to come onstream in December. Additional horizontal wells could follow, with the Mateguafa Attic potentially proving more material than initially anticipated. The M-6 well also intersected ~18 ft of net oil pay in the Carbonera C7 formation, compared to 11 ft in M-5. This zone has been placed on production at 824 bbl/d gross (412 bbl/d net), exceeding our expectations of ~700 bbl/d. Oil quality is high at 32° API with a low water cut of just 3%. There could be scope for further vertical drilling opportunities in this horizon. In addition, M-6 encountered 14 ft of net oil pay in the Lower Gacheta—a positive and unexpected outcome that adds incremental upside. Arrow is already considering adding new cellars at Mateguafa in expectation of new drilling locations. Gross oil production at M-5 remains stable at 550 bbl/d (275 bbl/d net), versus 570 bbl/d gross (285 bbl/d net) two weeks ago. With M-HZ7 being a horizontal well, production rates are expected to significantly exceed those of M-5 and M-6. In 2026, Arrow will test the Icaco, Macoya and the Capullo prospects. Our combined unrisked NAV for these three wells is £0.31 per share.
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Condor Energies (CDR CN)C; Target price of C$5.90 per share: Two bypassed pay zones add ~2 mboe/d. Flow rate at 1st Hz well by mid-December – The A-23 horizontal well at the Andakli field has reached total depth, completing a ~1,000 m open-hole section which is Uzbekistan’s longest on record. Initial gas flowback has already been observed at surface. A service rig will conduct flow testing, with the well scheduled to enter production in December. Meanwhile, the drilling rig will spud an even longer lateral second horizontal well from the same pad, targeting a separate carbonate reservoir currently produced via vertical wells in the Andakli field. At A-23, the vertical pilot well discovered a fair-to-good quality reservoir within the deep Jurassic Clastics. This horizon lies beneath the Jurassic Carbonates, which currently account for the majority of Condor’s production and reserves. While reserves in the deep Jurassic Clastics are presently minimal, Condor has highlighted the horizon’s potential to host material resource volumes. Two earlier wells drilled by the prior operator, NS-01 and NS-12, intersected the same horizon which was not placed on production at the time. Condor has now perforated 3.1 m of net reservoir at NS-01 and 2.1 m at NS-12. These intervals delivered strong flow rates 7.6–11.4 mmcf/d plus 58–66 bbl/d of condensates for NS-01 and 4.0–6.6 mmcf/d plus 12–20 bbl/d of condensates for NS-12. Both wells exhibited very high flowing pressures, reaching up to 1,735 psi. The results carry three key implications. (1) Production has risen ~20%, from 9,878 boe/d in 3Q25 to 11,844 boe/d. (2) Additional reserves are likely to be booked for NS-01 and NS-12. (3) The performance underscores the significant upside potential of the deep Jurassic Clastics. With netbacks of ~US$6/boe, the total US$0.5 mm investment for both workovers achieves payback in just 20 days at 2 mboe/d.
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New Zealand Energy (NZ CN)C; Target price of C$1.70 per share: Gas storage MOU signed with Genesis Energy – New Zealand Energy, L&M Energy, and Genesis Energy have entered into a memorandum of understanding (MoU) to advance the Tariki gas storage project. The MoU establishes an exclusive framework for collaboration across technical studies, commercial negotiations, and project development milestones, ultimately leading to a final gas storage services agreement. This agreement will underpin the path toward a final investment decision, project completion, and commercial operations. Genesis Energy’s market day presentation, which dedicated three full slides to gas storage and the Tariki project, serves as a strong endorsement of its materiality and strategic importance. Genesis believes that gas storage will “supercharge the flexibility” of its portfolio. It will also be a very important piece of the broader LNG strategy. The key next steps include (1) the completion of subsurface and engineering work by YE25 to define gas storage capacity, cushion-gas requirements, operating pressures, and injection/withdrawal rates and (2) the design and sizing of the surface facilities. In addition, the Tariki-5A well will be returned to production in 1Q26 to assess performance. Assuming NZ$10/mcf average seasonal price volatility and 60 mmcf/d withdrawal capacity over ~100 days, the project could generate NZ$60 mm in annual gross revenue (NZ$30 mm / US$18 mm net to New Zealand Energy). Even after NZ$20 mm in annual operating costs, gross pre-tax free cash flow would be ~NZ$40 mm (NZ$20 mm / US$12 mm net). Applying a 10% required return for infrastructure assets implies a market value of ~NZ$200 mm (US$120 mm) net to New Zealand Energy once onstream. With gross capex estimated at NZ$120 mm (NZ$60 mm net), the project delivers a pre-capex value of ~NZ$140 mm (~US$85 mm) net to New Zealand Energy, equivalent to ~C$2.85 per share.
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Pulsar Helium (PLSR LN/CN)C; Target price of £0.80 per share: Jetstream #4 – 2nd well with high pressure – Jetstream #4 has penetrated the entire interpreted helium-bearing interval encountering pressurized gas during drilling. Bottom-hole pressure measured ~674 psi at 444 m depth, rising to 887 psi at 578 m. These measurements align with the pressure regime observed at Jetstream #3, located 600 m to the north, where bottom-hole pressure was estimated at ~960 psi at 661 m depth. The elevated pressures are highly encouraging, indicating the potential for materially higher flow rates and improved recovery compared to earlier wells Jetstream #1 and #2. Pulsar will now conduct a comprehensive evaluation program on Jetstream #3 and #4 in parallel. This will include open-hole wireline logging, flow testing, and pressure build-up analysis, complemented by laboratory testing of core and gas samples to determine gas composition and helium content (including Helium-3). Pulsar will proceed with drilling Jetstream #5, located 2.9 km northeast of Jetstream #1. The well is planned to reach a target depth of 1,524 m—deeper than Jetstream #3 and #4—reflecting its role as a larger step-out designed to test the possibility of dipping fracture systems.
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Serica Energy (SQZ LN)C; Target price of £2.05 per share: UK budget neutral for Serica – Average 3Q25 production was 27.5 mboe/d, comprising 15.4 mboe/d from Bruce, 7.7 mboe/d from Triton, and 4.4 mboe/d from other assets. This performance is in line with expectations, given issues at Triton, that are now solved, were previously flagged. Portfolio production had rebounded to once again be over 50,000 boe/d, of which Triton was 25.3 mboe/d ahead of planned subsea work that commenced on 23 November. As previously guided, production will be minimal during this work, which is expected to conclude by mid‑December. November’s Triton output was achieved using a single compressor, limiting throughput to 25–30 mboe/d. Testing of the second compressor is underway, and once operational will provide redundancy and potential uplift. Additional upside exists from the Belinda development, though for now we assume ~19 mboe/d average net production from Triton in 1H26. The company guides for 27–28 mboe/d of production in 2025, with capex of ~US$250 mm. Our FY25 projections are broadly unchanged, with net debt expected at ~US$175 mm at year‑end. While the UK budget has no direct impact on forecasts, it could create incremental M&A opportunities for Serica. With Triton production normalizing and Prax assets contributing from late 2025, Serica is positioned to return to growth in 2026. The sunset date for the EPL remains 2030. Beyond that point, or earlier if commodity prices fall below the EPL threshold, the EPL will be replaced by the Oil and Gas Price Mechanism (OGPM). The OGPM will tax the proportion of revenue earned above the inflation‑adjusted thresholds of US$90/bbl and £0.90/therm, at a tax rate of 35%. For 2030, this equates to ~US$97.6/bbl for Brent and ~£0.98/therm. These thresholds are well above our assumptions (US$70/bbl Brent and £0.84/therm NBP), meaning the OGPM has no impact on our valuation. With regards to licensing, the new regime will have no effect on Serica’s existing portfolio, planned developments, or its growth strategy, which remains centered on near‑field appraisal and development around established hubs.
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IN OTHER NEWS
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AMERICAS

Eni (ENI IM): Entering Uruguay exploration – Eni is acquiring a 50% interest in exploration offshore Block OFF-5 from YPF. Block OFF-5 covers an area of 16,883 km2 in water depths ranging from 800 m to 4,100 m, at 200 km from the coast.

GeoPark (GPRK US)C: Reserves increase – Total 2P reserves increased 38% year-over-year to 121 mmboe at YE25 vs. YE24, driven primarily by the addition of 36.7 mmboe in Argentina.

Upland Resources (UPL LN): Agreement with Lost Soldier for US assets – Upland Resources has entered into a strategic partnership with Lost Soldier Oil and Gas. Lost Soldier will subscribe for £3.3 mm of new shares in Upland at 3.3p per share. Upland will make a corresponding ~US$4.4 mm investment into the Lost Soldier private placement. ~ 6 tcf of natural gas has been discovered in Lost Soldier’s Wild Mustang Federal Unit in the Wyoming.

FORMER SOVIET UNION

Nostrum Oil & Gas (NOG LN): 3Q25 results – Production in Kazakhstan from January to September 2025 was 16.3 mboe/d. Net debt at the end of September was ~US$501 mm.

MIDDLE EAST AND NORTH AFRICA

Energean (ENOG LN): 3Q25 update – 3Q25 production was 176 mboe/d. The FY25 production guidance has been re-iterated but the YE25 net debt is now expected to be US$3.1-3.2 bn (US$2.9-3.2 bn previously).

SUB-SAHARAN AFRICA

Invictus Energy (IVZ AU): Update on transaction with Al Mansour – Invictus, Al Mansour and other Qatari parties are negotiating an agreement with a pathway for Al Mansour to become a 50% shareholder of Invictus. As a result of the continuing negotiations, the settlement of the placement announced in 3Q25, has been deferred to on or before 27 January 2026.

Orca Energy (ORC.A/B CN): 3Q25 results – 3Q25 gas deliveries in Tanzania were 4.7 mmcf/d. Orca held US$117.3 mm in cash at the end of September.

EVENTS TO WATCH NEXT WEEK