Oil price, Sound, Hurricane, Chariot And finally…
WTI $51.93 -58c, Brent $60.94 -$1.07, Diff -$9.01 -49c, NG $2.39 n/c
Oil drifted yesterday on news from China that the economy may be cooling further than expected. In the US President Trump took further ownership of the trade talks but did offer the carrot of a meeting at the upcoming G20 meeting in Japan. Finally retail gasoline prices in the US keep falling, last week the average was $2.67 a gallon which is down 6.2c w/w and 20.9c y/y.
Sound has announced that it is planning to raise $3m at 10p in order to strengthen the company’s cash position whilst it continues to explore marketing it Eastern Morocco portfolio. This is expected to conclude prior to the end of 2019 and in the meantime the cost reduction programme continues and will now include a 29% reduction of base salaries of executive directors from 1/8/19. A wise move to ensure that costs are under control and that the company is in a strong position during negotiations.
An operational update from Hurricane today and a very welcome piece of news for shareholders from the Lancaster EPS where first lifting and oil sales have been made today. It has confirmed that it has sold its first cargo from the Aoka Mizu FPSO to BP Oil International pursuant to its offtake agreement. Dr Robert Trice, CEO said in the statement that the company was ‘now building the cash flow necessary to invest in the further appraisal and development of Hurricane’s basement assets’. I’m sure that the CFO would also welcome first revenue and this marks another important step for the company.
Chariot Oil & Gas
Chariot has given an update on the Development Feasibility Study and Gas Market Assessment which have completed with regard to the Anchois Gas Field in Morocco. In the detail are that the development is technically feasible and has the potential to be done either by a single phase or a staged development to ‘commercially optimise access to different parts of the gas market’.
The options include a ‘subsea to shore’ concept which, using industry standard technical solutions and equipment, ties subsea wells via a manifold and a subsea flowline and umbilical, connect the field to an onshore CPF and then into the Maghreb-Europe Gas pipeline. The study also showed the potential to re-enter the Anchois-1 gas discovery well which may be completed as a producer.
From that stage the market in Morocco becomes important and we know that demand is growing strongly in-country and with internationally high prices which make the project commercially highly attractive. With an EIA already under way the project could see appraisal operations in 2020. Along with this and a Drilling EIA, the opening up of the partnering process should lead to a wide range of potential strategic partners ‘throughout the energy value train’. All in all Chariot appear to be getting on in the exciting Lixus Offshore Licence and prospects are looking most interesting.
I forgot to mention that the Toronto Raptors beat the Golden State Warriors 4-2 in the NBA Finals and won the title for the first time.
In the CWC Bangladesh put up a great performance to beat the Windies who now have all the work to do to make the last four. Today it is England V Afghanistan at Trent Bridge, England batting first are 86-1 after 17 overs.
And of course today sees the start of Royal Ascot which over five days will produce some of the finest flat racing in the world.