WTI $67.20 +85c, Brent $69.35 +73c, Diff -$2.15 -5c, NG $3.88 +10c, UKNG  87.45p +0.91p

Oil price

A modest rally yesterday, after the panic there was a feeling in the market that despite the Delta risk in the market there was no need to bring oil prices to a new level. G Sachs did trim it’s forecast for 3Q but that had been looking a bit toppy anyway. After hours the API stats conspired as is their wont and crude built by a modest 806/- barrels whilst gasoline added 3.3m and distillates drew 1.23m b’s, the EIA later today will release its numbers…

Union Jack Oil/Reabold Resources

Rathlin as operator for West Newton have provided an update this morning, they have perforated an initial interval of 25 metres of the 62 metre Kirkham Abbey hydrocarbon column and well testing operations began on 7 June 2021, with an initial focus on the lower portion of the Kirkham Abbey.

The scale of completion fluid inflow into the formation indicative of permeability in the system and gas is being recovered to surface under test conditions. Gas analyses exhibit a strong similarity to analyses obtained from the West Newton A site wells with samples showing approximately 90% methane content and no native H2S (hydrogen sulphide).

Liquids recovered to surface are currently undergoing analysis and an additional 19 metre zone in the upper Kirkham Abbey identified for perforation and flow testing in the meantime operations  are continuing on the clean-up of the lower portion of the Kirkham Abbey and further flow testing of the Kirkham Abbey formation.

David Bramhill, Executive Chairman of Union Jack commented:

“We are encouraged by the indications of permeability of the lower portion of the Kirkham Abbey under test, and the initial recovery of hydrocarbons to surface.

“We are continuing with test operations in this zone which, along with the planned testing of additional zones, and the A-2 well, the results of which will be key data inputs into the ultimate development plans of PEDL183.”

Stephen Williams, co-CEO of Reabold, commented:

“We are very encouraged by the indications of permeability within the system, and of course by the initial recovery of hydrocarbons to surface. We look forward to continued clean up of completion fluids from the well, putting us in a position to assess hydrocarbon flow potential.  

 “Along with planned testing of additional zones and of the A-2 well,  the test will provide key data inputs into the ultimate development plans at West Newton, including the drilling of the deviated well at B-2.”

The very fact that both David Bramhill and Stephen Williams have made such similar comments would indicate to me that this really is just a holding statement, probably made as they said that they would comment after 6 weeks of such work. Stand back, there’s nothing to see as they say.

Pharos Energy

An update today from Pharos on their Vietnam operations where they announce the spud of the TGT-H4-34P development well from the H4 well head platform at the southern end of the TGT field, located in 47m of water depth in the Cuu Long Basin offshore Vietnam.

The well is being drilled using the jack-up drilling rig PVDII and the initial four-well programme will run to the end of this year with an additional two wells pending budgetary approval later this year. The TGT-H4-34P well is the first infill well in a planned four-well programme across the TGT field. Once each well is completed, it will be tied into the existing TGT processing facilities, contributing to the group’s production. The capital spend for the initial four-well programme is c.$13.2m net to Pharos.

Ed Story, President and Chief Executive Officer, commented:

 “After a period of enforced inactivity across all the company’s operations because of the downturn and pandemic, the commencement of the TGT infill development drilling programme represents a welcome and timely return to optimising production and value. In addition to the firm four wells planned for this year, two further wells are expected to be drilled next year once approved during the annual autumn budget process. The Full Field Development Plan also contains a further 9 contingent wells to be drilled in the years to come.”

 I’m really excited by this news from Vietnam for Pharos and I am also strongly of the view that the Egypt farm-out is still underway. Put together I really think that there is plenty of upside for Pharos where the shares have slightly underperformed recently. 

Wentworth  Resources

Wentworth has announced the appointment of Ms. Juliet Rugeiyamu Kairuki as an Independent Non-Executive Director, with immediate effect. With over fifteen years of experience in strategic leadership, institutional development, governance, project execution and stakeholder management, Ms Kairuki’s practice ranges from banking, financial market infrastructure, public private partnerships and investment.

Katherine Roe, CEO, commented:

“We are delighted to welcome Juliet to the Wentworth Board. With an impressive track record in the public and private sector in Tanzania and elsewhere in Africa, her regional expertise on strategy, regulation and financing will bring further depth and expertise as we continue to show our ongoing commitment to and investment in Tanzania. It’s an exciting time for the country as it looks to accelerate its growth following the global pandemic. We are committed to being a critical part of its story.”

Harbour Energy

Harbour today announces that during final commissioning and testing of the HGS Tolmount platform issues were identified in certain offshore electrical systems. As a result, Tolmount first gas will be delayed beyond the end of July and is now likely to be around year-end. With expected plateau rates of 20-25 kboepd net to Harbour, Tolmount was expected to contribute just over 10 kboepd to Harbour’s 2021 production.

As a result of this, and problems at the Elgin/Franklin summer shutdown, Harbour has revised down its guidance for this year which will now be c.185-195 kboepd.

I’ve made it clear that I feel strongly that Harbour is a fantastic collection of assets run by a first rate management team and is remarkably cheap into the bargain. Unfortunately as its first announcements have shown, it does not preclude it from finding banana skins in operational matters which interestingly were not present under previous managements.

And finally…

Congratulations to Brisbane which has won the race to host the 2032 Olympic Games, a prize that might be better received given that it was in a short list of one and so to speak, got a bye in the final…

In the final T20 last night England beat Pakistan with the last ball of the game to win by 3 wickets and the series 2-1. Next stop the dire Hundred but we have to like it as the ECB has invented it….