WTI $49.10 +74c, Brent $52.26 +76c, Diff -$3.16 +2c, NG $2.70 +6c

Oil price

Oil pushed ahead again on Friday with w/w gains of $2.53 and $2.29 for WTI and Brent respectively and yesterday Congress approved the $900bn stimulus programme ahead of close down day. However that is all changed this morning as the events in the UK on Friday in which the new Covid variant was revealed and much of the UK was pushed hurriedly into Tier 4.

This has prompted travel bans and indeed closure of some ports this morning which, with Brexit negotiations already struggling has left the UK somewhat exposed. Of course the fact that the vaccine has yet to be approved in the EU is probably a more telling fact.

The Baker Hughes rig count on Friday showed some drillers taking advantage of WTI nearing $50 by spudding more wells, again with the overall number of units up by 8 to 346 and oil up 5 to 263, another recent high. Money managers are as long of crude as they have been for a while, mainly on the back of a demand rebound led by a post pandemic global GDP recovery, this might shake a few out but those with pairs should hold tight…

Bahamas Petroleum

BPC has announced that the drilling of the Perseverance #1 well has commenced, targeting P50 prospective oil resources of 0.77 billion barrels, with an upside of 1.44 billion barrels the well is scheduled to take some 45-60 days to complete. This is quite some 100% bet and makes the next month or two of massive and strategic importance.

Simon Potter, Chief Executive Officer, commented: 

“We are very pleased to announce that the drilling of Perseverance #1 has commenced – the well has been spud. This is a momentous milestone for both BPC and The Bahamas and represents the culmination of more than ten years work by a team who have remained steadfast in their belief in this project throughout – that it is finally taking place is a testament to the application, skill and professionalism of many people over those years. The well will be drilled to the highest environmental and safety standards over the next 45 – 60 days. Our Shareholders have been extremely patient, but we are now within a couple of months of understanding the scale of potential resource uplift that might be accessed within the licences: a potential uplift that is the traditional domain of the ‘oil majors’. 

“More than a decade ago BPC secured several offshore hydrocarbon licences in the far-southern waters of The Bahamas. Convinced of the compelling prospectivity of those licences, the Company has spent close to $120 million bettering our technical understanding, continuing to de-risk the play, and ultimately preparing meticulously for exploration drilling. Our 3D seismic survey revealed structures that have the potential to contain a world class, multibillion barrel oil resource that, if present in the way we hope, could prove to be transformative – not just for our company, but for the nation and people of The Bahamas as a whole.  

“I very much look forward to updating shareholders with results once the well has been completed. The next several weeks will be a truly exciting time for BPC.”

The day that many people didn’t expect to come has arrived and the biggest and potentially the most rewarding wildcat for a very long time has spudded offshore the Bahamas. There is no doubt that Perseverance is the right name for the well, all one can do is wish it a safe and sound month or two for all involved.


An announcement this morning with regard to the Mako Gas Project where a ‘significant amount of work has now been completed to update the Plan of Development (“Mako POD”) by incorporating crucial and extensive data collected during the highly successful appraisal drilling program’.

The Indonesian regulator has accepted the significantly uplifted volume estimates, which are broadly in line with the independent resource audit by Gaffney Cline and Associates (“GCA”) completed and announced in May 2020. These volumes will therefore form part of the updated Mako POD, which is currently being prepared.

Empyrean CEO, Tom Kelly, stated:

 The highly successful appraisal program has resulted in a significant increase in resources at the Mako Gas Field. The operator Conrad and the joint venture partners are working diligently through all of the practical steps to put this exciting project into production.

Empyrean and Coro have an exciting prospect at Mako and this announcement provides very positive news that should result in the FID being made and both companies being able to monetise their investments. With a GSA looking quite close and big markets in Indonesia and Singapore likely to come good the outlook is very promising.

Block Energy

Block has made another NED appointment, again I wouldnt normally comment as such on these things but this is a very positive move for the company. David (Dato) Sandroshvili has significant experience both at the sharp end of the oil business as well as in corporate finance for a number of leading houses. Dato is a dual national of Georgia and the United Kingdom and will surely be able to add to the depth of the board.

And finally…

Saturday’s results from the Prem included the Eagles leaking 7 to Liverpool at home whilst the Noisy Neighbours just did enough to beat the Saints 0-1. The Toffees beat the Gooners 2-1 and the Cottagers got out of the bottom three with a 1-1 at St James’ Park.

On Sunday the Seagulls got a late equaliser against the Blades whilst the Foxes win over Spurs sent them to 2nd in the table whilst Spurs have gone from 1st to 4th tier quicker than London.. The Red Devils beat Leeds 6-2 and it was a bad debut for new Baggies manager Big Sam Allardyce as they lost 0-3 in the local derby against Villa.