Amerisur/Gulfsands, Ophir Energy,Cabot, Faroe

WTI $45.33 +72c, Brent $52.20 +4c, Diff -$6.87 -68c NG $3.30 -24c

Amerisur Resources/Gulfsands

The companies have announced completion of the farm-out of the PUT 14 licence which is adjacent to the AMER Terecay block in the Terecay-Tacacho fairway. For Gulfsands this means saving of obligations valued at $16.1m on the work programme and means in can concentrate in the Levant region.

For Amerisur it means that they take on obligation for 2D seismic and one exploration well on the acreage subject to completing a Consulta Previa. This will be an important test of the company’s partnership with Oxy as it may extend south towards the Putumayo river and the Ecuadorian border as well as being close to the OBA pipeline for distribution into their systems. All round a really good deal for both sides which can’t always be said.

Ophir Energy

Ophir has announced that they are still waiting for a response from the EG Ministry with regard to the extension of the Block R license. They expect lapse or an extension by mid-January which will clarify things. An extension would mean a chance to revive financing although my suspicion, voiced some months ago, that investors would be better advised to wait for the license to lapse and then pounce still seems the best option…

Cabot Energy – Instant Karma

Cabot has announced that they are in financial difficulties, an RNS was hardly needed for that observation but this sets out the requirement for a short term cash injection. The company says that a deep discount capital raising will be needed in January via Open Offer and whilst they seem to have the support of their major shareholder, others may not be so compliant. They even go as far to say that this raise would be followed by another raise for ‘growth purposes’ in the second quarter, don’t say you haven’t been warned…

New Cabot blames the previous management team for ‘work programme cost overruns’ which is a bit rich so far after the event when the new management delivered the coup de grace some time ago and state that failure to raise this money might lead to the company going under. Cabot has not been of investment status since then so maybe this course of action might just be the kindest cut, at least it was an unexpectedly merciful release for the P45 brigade from last summer…

Faroe Petroleum

I didnt write a blog on Friday so couldnt cover the response to the latest DNO rhetoric which primarily revolved around the requirement for an updated CPR. DNO seems to think that demands for such a CPR are not unreasonable but as this is normally only an annual basis and, one assumes is the same for them, the accusation lacks merits. Whilst this is not a five minute operation, nor would it be for DNO, it seems like an interesting call in the circumstances.

The bid is closely linked to the oil price and offering cash carefully hides the fall in the DNO share price over the same period, this can be proven by the rather absurd claims of a 45% premium which disappears like a panto magic trick when appropriate comparisons are made. The next few weeks will be vital in this process, only an investor with a compelling view that the oil price has a serious fall immediately ahead could justify accepting such a bid, they certainly don’t accept the bid or sell out anytime soon…

Finally…

I would like to wish all blog readers a peaceful and prosperous new year. Many thanks for your kind wishes over Christmas which I return to you all. Malcy

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2 comments on “Amerisur/Gulfsands, Ophir Energy,Cabot, Faroe
  1. chris walker says:

    happy new year and many thanks for keeping me up to date with all things oily

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