Weekly news, topics and discussion

This week, we released a sector update for our E&P coverage. We made minor changes to our oil and gas prices assumptions, but struggled to find an appealing risk/reward among our large caps, especially gas-heavy names. We favour Aker BP and Panoro Energy as our top picks, while Equinor remains a funding candidate. In other news, Equinor and Aker BP released Q4 trading statements. We view Equinor’s figures as neutral, and Aker BP’s as strong, due to solid production and realised oil and gas price...

Energy Morning - 17 January 2025

AUCTUS ON FRIDAY - 17/01/2025

AUCTUS PUBLICATIONS ________________________________________ Corcel (CRCL LN)C; Target price of 1.00p per share: Initiating Coverage - Corcel is a ~£6 mm market cap AIM-listed E&P company focused on Portuguese-speaking Angola and Brazil. It offers a unique exposure to the prolific Kwanza onshore basin in Angola which reopened to international companies in 2021. Corcel is also building a portfolio of mature onshore producing assets in Brazil. The key asset in Angola is the KON-16 licence, which C...

Lucror Analytics - Morning Views Europe

In today's Morning Views publication we comment on developments of the following high yield issuers: Salt, Ineos, Ineos Quattro, Borr Drilling

Limited prospects for re-rating

While our coverage universe has seen a strong start to the year, we have made minor alterations to our oil and gas price assumptions, as sanction-related upside potential appears to be priced in the Brent oil and share prices. Thus, we struggle to find an appealing risk/reward among the large caps, especially gas-heavy names, prompting us to downgrade Vår Energi and BlueNord to HOLD (BUY). We favour Aker BP and Panoro Energy as our top picks, while Equinor remains a funding candidate.

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

Weekly news, topics & discussion

This week, Equinor reported a preliminary internal gas price of USD12.05/mmbtu for Q4, slightly below Bloomberg consensus and 10% below the TTF day-ahead for the quarter. It also announced that the ongoing outage at its Hammerfest LNG facility was being extended by 10 days to 19 January. In other news, BlueNord reported preliminary net production of 28.9kboed for December, and 26.0kboed for Q4, slightly below our estimate of 29.0kboed.

Crude Quarterly Q4'24: oil market stabilising

Estimate changes from Crude Quarterly, 10 January

Estimate changes from Crude Quarterly, 10 January

Namibia uncertainty with Shell write-down

Shell is reportedly due to make a write-down in Namibia as discoveries are estimated to be commercially unavailable. Shell has been among the most active oil companies in Namibia, with five discoveries announced, and there have been expectations for future developments. Hence, we see the write-down as a setback for future development activity (which consumes more oil services volumes than exploration). As Total has appeared more optimistic on future developments in Namibia in the past, this setb...

While waiting for Pemex

With outstanding Pemex receivables equal to around five quarters of revenues, key for offshore drillers with Pemex exposure (Paratus and Borr Drilling) is to start to collect or monetise receivables during the next few months. Although Pemex is in a challenging financial situation with declining production, local reports and statements from the Mexican president suggest suppliers should start to get paid by March. For Paratus and Borr Drilling, payments would be a relief, while continued delays ...

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

Weekly news, topics & discussion

This week, BlueNord announced that plateau production at Tyra is now expected to be delayed by around three weeks due to adverse weather, shifting the timeline to the second half of January 2025. Consequently, we expect a dividend announcement around or with its Q4 results (due on 12 February). In other news, the Arkenstone drilling campaign has been temporarily suspended after encountering shallow gas. Also, DNO and OKEA have agreed to swap 10% interests in the Mistral and Horatio prospects.

Valuation and market update

In this note, we show updated valuation and market statistics for the Offshore Drilling sector.

Solid NCS production in November

The Norwegian Offshore Directorate’s (NOD) preliminary NCS figures for November showed liquids and gas production slightly above its own forecasts. Liquids production was 1,975kboed (2.1% above its forecast) and gas production was 360mcm/d (3.0% above). Overall production was 4.24mmboed, up 2.1% MOM (2.6% above). Company-wise, production was up MOM in October for all companies, following the maintenance-heavy September. Also, the water-cut for Johan Sverdrup seems to have stabilised in recent mo...

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

First award confirmed under Petrobras ‘rig pool’ tender

Constellation confirmed the contract award under the Petrobras ‘rig pool’ tender after being the low bidder on Lot 1 with its 6G drillship Amaralina Star (dayrate of cUSD429k including third-party services). Based on the confirmation of Constellation, we believe the remaining two awards in the ‘rig pool’ tender have likely also been concluded, with Etesco’s 6G drillship Etesco Takatsugu J (USD352k) and Seadrill’s 7G drillship West Jupiter (around the USD450k level) as the low bidders. As highlig...

Valuation and market update

In this note, we show updated valuation and market statistics for the Offshore Drilling sector.