WTI $32.50 +85c, Brent $33.10 +$1.30, Diff -80c -45c, NG $2.19 +1c
The market remains full of chatter about an Opec/non-Opec meeting to discuss production cuts but is acutely aware that expectations should not be raised too much. The EIA stats showed a build of 8.4m barrels against forecasts of 4.3 but a high number was expected after the API numbers, indeed this number was not as bad as feared and again stocks drew at Cushing.
The FOMC was a right laugh, to think that this lot are left in charge of more than a whelk stall. Nevertheless beggars must not be choosers and now that rates are not, repeat not, likely to run away the greenback may stall, at least until next month’s meeting by which time all bets will be off again.
83% in favour of the BG bid was more than expected and with today’s turn of the latter’s shareholders there should be completion on February 15th. The deal gives Shell scale with Brazil, QCLNG and the LNG business being ultimately bigger and at a much lower cost. The combined beast will be a lean, mean, but scaled super major unrecognisable from even the recent past. All this and nearly a 10% yield into the bargain makes me think that there is a price for everything.
Kosmos has made a ‘significant gas discovery’ offshore Senegal with its Guembeul-1 well some 5 km south of Tortue-1. 101m of pay in 2 excellent reservoirs with continuity into Tortue under static pressure means that resource estimates have gone up sharply. The Pmean of this find has gone up from 8 TCF to 11 TCF and in the Greater Tortue Complex the number rises from 14 to 17 TCF. By any means this is another great discovery and the company has entered into a MOU with the Senegal and Mauritanian Governments to move ahead to early field development.
Victoria Oil & Gas
Hot on the heels of its trading update VOG has announced a 2016 operations outlook. The target for 2016 production is 3.7 BCF which would be a 30% increase on last year. Most gas is contracted at $9-16 mmbtu and the company point out that as no oil is explored or produced as a primary product. Indeed the company are keen to ‘enhance the market valuation’ by ensuring that it is seen as a gas utility in a fast growing market full of growth from a number of quarters. With two exploration wells, new products such as CNG and a continued war on costs I tend to agree that the market has got this one wrong, which means I guess, that Mr Hart or someone similar should bid for VOG which has only a market cap of £33m….
Independent Oil & Gas has announced that the OGA has extended its Skipper licence to December 2016 which is a bit handy as the company only recently announced that it had pushed the well on the licence back until ‘later this year’.
So, the Clueless Cup final will be between the HubCap Stealers and the Noisy Neighbours who beat the Toffees last night.
At the tennis Johanna Konta finally went out this morning but next week will be ranked 28th in the world. Muzza plays tomorrow knowing that brother Jamie is in the doubles final.
And many thanks to Robert Speed, Speedy to old city lags, and the KREAB team who very kindly invited me to their table at the Growth companies awards dinner last night. A few friends were seen and a few blog readers wandered over for a chat, great fun.