WTI $82.70 +92c, Brent $84.47 +69c, Diff $1.77 -23c, NG $3.80 n/c

Oil price

I think at the moment we shall call this day, short closing Friday as the market has got used to ‘taking out a Rupert’ during the week and covering the position on Friday to ensure they aren’t left exposed over the weekend. There is nothing much to add this morning on the oil price front, the EIA stats showed a build of 8.9m barrels of crude against the whisper of 2.6 which was in line with the API stats. Gasoline drew 4m barrels which was a bit more than yesterdays number and stocks there are at a two year low.

The EIA also reported that Japan continues to import record volumes of LNG, the cumulative number for the 8 months to end August being 11.85 Bcf/d. With Japan still dependent on oil and LNG due to lack of nuclear power and an increase in gas-fired power generation, at least one market remains positive although I have seen reports that Russia is proposing an oil pipeline into the North of the country.


Third quarter figures from Schlumberger beat the whisper with EPS coming in at $1.49 against consensus of $1.46. Revenue was a record, up 8.6% year on year with a strong performance in North and Latin America. Northern Iraq suffered some ‘headwinds’ which is a nice way to describe it but Saudi Arabia and Oman were very positive. The company acknowledged the current oil price situation but said that ‘there is no reason to change the view that at the present time .. a relatively well balanced supply and demand situation’. At $90 the SLB price is understandably reflecting the current oil price situation and may represent taking a risk, but over anything other than an extremely short timescale I think that it looks like good value, especially if it reaches the January low of $86.


The IMS from Petrofac this morning added little to our sum knowledge but did provide some comfort with regard to the order book. Net profit is still likely to be in the $580-600m range as previously guided and the ECOM order intake is now $9.4bn to date giving a backlog of $21.2bn up from $20.3bn at the end of June. This gives good revenue visibility through next year and we are told that this work is on bid margins ‘in line with the last few years’. IES is ensuring delivery of key milestones in its existing portfolio with first oil at Cendor phase 2  in Malaysia but there is little to read into the statement for the rest of IES going forward.

News from BH, SLB and now PFC has been ok in the last 24 hours and whilst all three managements could have taken the opportunity to warn it is interesting that none have, providing HAL don’t do so on Monday we may be restoring a bit of confidence…

Lamprell- Number Crunching…

As do the seasons change so does the Lamprell Board, today the CFO, Jo Curin has resigned having been in the job for just one year. The temporary CFO will make four CFO’s within two years, which Oscar Wilde might call careless.  It is fair to say that in a short space of time Jo has managed to fit a lot in and has masterminded the major refinancing including a big rights issue but hey, that’s all part of the job description. Word has it that the company are not rushing to find CFO number 5 although candidates may be thin on the ground given the history, even working in sunny Dubai.

I am a big fan of CEO Jim Moffatt and the way Lamprell has changed from top to bottom in the last year or so, and given the trauma that occurred in 2011 and 2012 rebuilding is very much going to plan. Again the company has suffered from recent oil price weakness and capex concerns but if anyone is sheltered from this, Lamprell is. I had hoped that the company would fix up a visit at some stage, maybe this has been the reason for not doing so and that next spring they will do it but getting to see the company, already difficult will now be harder. I do think that this is a good recovery play but I suspect that Timeform would give it a squiggle §, for management portability…


I wrote about Pantheon the other day as I think that there is a lot to be excited about for the company now that it has upped the stakes in its JV with Vision and raised money recently. Last Friday afternoon, at the height of the melt down in E&P stocks, Pantheon snuck out a perfectly good announcement about the successful acquisition of acreage mentioned in the placing documents. Apart from the obvious, i.e. get some IR guys, this is more good news as these key oil and gas leases give them 57/- net acres in Polk and Tyler Counties . With 50% of the JV and a 25% interest in certain other leases things are looking up for Pantheon. The only thing I noticed was that I’m sure that in the placing doc it said drilling would be 4Q 2014 which has now morphed into ‘late Q4 or 1Q 2015…Watch this space it may be an interesting ride.


Yesterday I had a great CEO interview on TipTV where my guest was Jay Bhattacherjee of Aminex, who has an interesting story just now. Details are on the website www.malcysblog.com  or here is the link.



And finally…

Its back to proper football after the infernal break but it has returned with a less than inspiring fixture list. The Noisy Neighbours host Spurs, Chelski the Eagles and new BG CEO Helge will see his Gooners take on the Tigers. Apart from that, ‘Arry’s job is on the line as they welcome the HubCap Stealers who will have no ‘fatigued’ players I suspect. Baggies fans will wait til Monday for the visit of the LvG all-stars.

Royal Ascot sees Champions Day which is always good even without Frankel although we will have the next best thing as his brother, Noble Mission will try to keep the family flag flying high.

Its back to European Cup rugby although farewell the Heineken Cup, now replaced by the European Champions Cup. Fixtures include Quins v Castres tonight, and Leinster v Wasps but probably the pick of the crop is high flying Saints going to Racing Metro…

The Royals will face the Giants in this years all wild- card World Series after Travis Ishikawa hit a walk off home run as the Giants overcame the Cardinals in San Francisco.

And most intriguing of all is that the West Indies have pulled out of their tour of India, but get this, they are in the middle of a match and the players wont be told until the next break that they are going home forthwith, whatever next, answers on a postcard…