WTI $105.34 -3c, Brent $112.29 -7c, Diff $6.95 -4c, NG $4.45 -1c
We are back in a bit of a rut, with Iraq still producing strongly and Libya opening up terminals at Es Sider and Ras Lanuf giving them scope to export up to 500,000 b/d, there is plenty of oil around, for the time being. The traders who have joined the party in recent days will not be there for long so watch out and see if there is any wobble, I bet the traders and genuine buyers aren’t helping them out right now. The API stats showed a fall of 876/- barrels against consensus of 2.2m in crude oil and gasoline stocks, important ahead of the Independence Day weekend fell by 407/- against predictions of a rise…
Caza Oil & Gas
Yesterday lunchtime Caza announced that it had raised $10m via a placing of 32.7m shares at 18p, a very creditable 4.6% discount to the previous close. I understand that the placing was oversubscribed which accounts for the narrow discount as well as the favourable move post announcement. Caza has won many new friends with its campaign in the Bone Springs and this cash injection will help with drilling and further asset acquisitions. I expect more corporate activity maybe to include some refinancing and remain a strong supporter at these levels.
It will come as no surprise that I really am off Tullow’s mailing list, I had to dig around the LSE news stories for the operational update this morning. As it was it really wasn’t worth the digging, the company has $2.3bn of debt facility capacity and Kenya has a number of successful exploration, appraisal and testing wells to come. However the mixed frontier exploration has led to yet another write-off, this time $415m and a loss on disposal added $115m to that number. Situation normal by the looks of it as Tullow are promising lots but still failing to deliver, wait and see how good Kenya really does come.
An update from Canada this morning on operations and production from the Virgo redevelopment project. The work over of 16-19 has been completed ahead of schedule and it is now producing at 100-140b/d restricted flow rate. 14-22 is shut in to conserve solution gas and presumably to avoid flaring as well. With current field production of some 200 b/d the production led story is happening but painfully slowly, management is doing the best it can with hands somewhat tied behind its back so much patience is going to be needed for shareholders here.
Shelf Drilling pulled their float today amid what can only be called IPO fatigue. Shelf’s backers must have been extremely reluctant to be forced down price-wise by the institutions and it is clear that there is a price below which they thought that there was some mickey taking. Having said that the company is well financed and comfortable in its trading outlook which gave it the ability to walk away if only because they can. I’m sure we will see Shelf again and if they get to know the London market well enough there is no reason why it cant reappear again successfully.
I had a long and interesting meeting with Philip O’Quigley CEO and Michael Gallagher of Falcon Oil & Gas this morning and will write up a full report shortly, overall an extremely positive meeting.
The Range Resources Investor Group turned out en masse for Oil Barrel this morning and Rory Scott Russell was very good and tells a good story very well.
I have also been on TipTV this morning which is really gearing up very nicely, Nick ‘Moose’ Batsford and Zak Mir have a good team with them and I enjoy being part of the set-up. Today after talking about good calls on Kentz and Hurricane (TP still 90p) I went through Faroe, Range Resources, Lamprell and Caza, see it all on this link below, will be on website soon.
The blog is an afternoon one today as you will have read that its been a busy day already! There is no blog tomorrow or Friday as I am away on a field trip with Sound Oil in Italy, lots to report next week I hope.
It is going to be a monster weekend of sport and I’m sorry that I wont be reporting for a day or two but I’m sad to say that having lost this afternoon Muzza wont be in the Wimbledon final on Sunday. Could it be ‘baby Federer’ or even teenage Aussie or maybe even Federer senior?
The World Cup moves to the quarter finals and for the first time under this format all the group winners have made it. Only just though as a very listless Argentina squeaked through as did Belgium last night.
The Tour de France starts at the weekend in Yorkshire would you believe it? After that its London then back over La Manche for the real stuff.
And of course its the British Grand Prix at Silverstone as well and Lewis Hamilton must really win to get back on terms with his team mate who parked the car in quali at Monaco to keep him off pole…
English Kev will be at Lords on Saturday but not for England, take a look at the players in the MCC v Rest of the World side, its a veritable feast of international stars…
And of course very finally it is Independence Day on Friday and I wish all of you over the pond my warmest greetings!